Battling Brokerage Firm Abuse

Investing with a brokerage firm can seem much easier than making investing decisions on your own. However, there are times when a brokerage firm may take advantage of an investor, and this means that you may want to get some assistance. Cold Spring Advisory Group is a national network of investment experts and lawyers who can look at your case and determine if your losses are due to stockbroker abuse or negligent advice. If your losses are the result of poor financial management, then the experts will refer your case to one of the lawyers in their network who specializes in your type of arbitration.

How Common is Brokerage Abuse?

While you may think that brokerage or stock broker abuse is not that common, it is probably more common than you think. The only time that we hear about it is when the broker is caught, but how many are not caught? These could be small losses or millions of dollars, but if no abuse is suspected, it could go unchecked, which could mean that the broker could continue to give bad advice or misuse other people’s investments.

There are many different ways that a broker could take advantage of an investor. While most people think that they will know if someone is taking advantage of them, some abuse is not as overt as you may think. Here are some of the most common ways that brokers have abused their investors.

  • Unsuitable investments: Did your stock broker recommend high-risk stocks or pressure you to invest in securities you didn’t understand? This could be recommending unsuitable investments.
  • Misrepresenting or omitting facts: When a stock broker gives misleading information or withholds facts that could have impacted your investment decision, this is a form of abuse. All relevant information about the investment must be disclosed.
  • Over-concentration: Was most or all of your money invested in one market sector or type of security? This is concentrating your investments. Diversifying or spreading it across various types of stock and industry sectors is much safer.
  • Unauthorized trading: If your stock broker made a purchase for your account that you did not approve, this is unauthorized trading and it is a form of fraud.
  • Churning: This occurs when there is excessive trading to make quick profits, such as buying and selling the same stock multiple times.
  • Timely execution: Your stock broker is required by law to execute your orders promptly and not refuse an order. Otherwise, their actions could be construed as fraud.
  • Inappropriate Mutual Fund and Variable Annuity Sales: When a broker switches between mutual funds to earn more commission, sells various loaded funds, or Class B shares to clients who could qualify for Class A shares, this could be abuse.
  • Illegal Accounts: If your broker has ever asked you to use an address other than the one you have for your home or business or suggested that you lie on an application for your investment account, this is potential broker fraud.
  • Unlicensed or unregistered: Your broker, advisor, and other investment professionals should be registered to sell securities, and your security products should be registered.
  • Any other fraudulent activity: This could include funds withdrawn from your account without your authorization, delay of delivery of securities or liquid funds, forgery, and misappropriation of funds.

Finding Someone to Fight For You

If you suspect that you have been a victim of broker abuse, you want to get some professional help to not only help to validate your claim, but also to help you take the next steps. Cold Spring Advisory Group will give you the guidance that you need to go through the process. Their case evaluation program uses forensics to investigate whether your losses are due to abuse or negligent advice. They also identify whether you have a claim for loss recovery and refer you to a lawyer if you have a case for litigation. Cold Spring Advisory Group can give you the advice you need to determine what steps you need to take.

Best of all, there are no hourly fees for consultation. Cold Spring Advisory Group is not a law firm. Instead, they recommend your case to a lawyer in their network who specializes in your type of case. The lawyers they recommend work on contingency, which means there are no additional expenses or hidden fees. They work on the litigation to help you in your fight for loss recovery.

If you suspect that the losses that you have sustained were directly related to abuse or fraud on the part of your stock broker, then you want to take action and get help from a consultant. Cold Spring Advisory Group can investigate and determine if there was fraud and can aid you in loss recovery. This can help you and can help future investors as well.

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