Suffering stock market losses is not uncommon, but when your stockbroker or brokerage firm is responsible for causing these losses, you can bring them to arbitration with the help of a securities arbitration attorney in order to attempt to obtain full remuneration for all you’ve been through.
There is a certain level of trust you need to have in your financial broker; after all, they are handling all of your investments, managing your portfolio, and taking responsibility for helping you achieve your financial goals.
Stockbrokers who are only interested in gaining substantial commissions and padding the pockets of the brokerage firm that employs them are more than likely engaging in stockbroker misconduct, which can result in massive financial losses for you.
The attorneys at Meissner Associates understand how devastating these losses can be on your life, and we will stop at nothing to attempt to hold the at-fault party accountable for the damage they’ve done for their own personal gain. A securities arbitration lawyer will work to build a powerful case against fraudulent stockbrokers and firms so that you can hopefully recoup your financial losses and move forward with your life.
FINRA Suitability Obligations
The Financial Industry Regulatory Authority (FINRA) and the U.S. Securities and Exchange Commission (SEC) are responsible for regulating and enforcing the conduct of stockbrokers and brokerage firms. As part of these regulations, FINRA has developed certain obligations that brokers need to meet when working with investors.
Possibly the most important of these obligations is the suitability obligation. Rule 2111 describes the suitability obligation as being a duty brokers have to only make investment recommendations that the broker can reasonably believe will be suitable for their client. There are three ways this is done:
- Customer-Specific Suitability – For a broker to meet the suitability requirement, they should ensure that any and all investment opportunities align with the investor’s objectives for their investments.
- Reasonable-Basis Suitability – This means that the broker has done their due diligence by researching the investment opportunity before presenting the recommendation to their client. Here, the stockbroker must also present the investor with the possible risks and returns associated with the investment.
- Quantitative Suitability – When a broker has control over the investor’s account, they must ensure that the investor’s accounts are not excessive in relation to the rest of the investment portfolio.
As long as these three duties are met, the broker managing your investment accounts will have met the FINRA suitability requirements. But there are a number of different ways that a stockbroker or brokerage firm can engage in misconduct, which we describe in further detail below.
Types of Stockbroker Misconduct
Before you chalk your stock losses up to an unfortunate investment and fate, you should consider whether your stockbroker engaged in misconduct that resulted in your loss. There are seemingly endless ways that brokers can commit fraud, the most common of which include:
- Providing misleading information
- Selling away
- Suggesting unsuitable investments
- Unauthorized trading
- Broker negligence
- Failure to supervise
It may come as a surprise that stockbrokers can often fly under the radar when choosing investments that are going to lead to huge commissions for themselves but losses for you.
Although there is always a risk when you invest, your risk shouldn’t stem from your broker, and when it does, you can work to bring them to justice by pursuing an arbitration claim against them that may allow you to recover your losses in their entirety.
Why You Need a Lawyer for Your Arbitration Hearing
The easiest and least expensive way to recoup your losses is to pursue a FINRA arbitration hearing. FINRA will assign you a panel of three arbitrators who will preside over your securities arbitration hearing.
Your lawyer will present the evidence needed to support your claim that your stockbroker is responsible for your substantial losses, and the defense will then attempt to explain how the broker did not engage in misconduct.
From there, the arbitrators will review the details of your case to determine if you are entitled to recovery of your losses and, if so, how much you deserve. It is important to note that once a decision has been issued in your case, we will not be able to bring your case to court.
Consult with a Reputable Securities Arbitration Attorney
When your stock losses exceed $100,000, you need a highly trained securities arbitration lawyer on your side to fight for the recovery you’re entitled to. You can schedule a free consultation with the attorneys at Meissner Associates today by completing the convenient contact form we have included below or by calling our office at 212-764-3100.
Description: FINRA had sent me several series of questions to answer for 8 months. I email them a 6 page response and FINRA requested more questions within 20 minutes. It was never ending. I was unsure of the phrases used or what they wanted in my response. My evenings and weekends where consumed with worry and writing responses to events 11 months ago. Stuart, returned my phone call, and followed up. He helped me limit superfluous information and zero in on the questions being asked. This was fairly settled and closed. My life is back to helping my clients.
Rating: 5 out of 5