Sacramento Broker Fraud Attorneys Protecting Your Interests
Helping California clients recover after sustaining losses because of stockbroker fraud
The dangerous ramifications of broker fraud go far beyond one individual investor. When one investor client is harmed, either financially or otherwise, countless other potential future investors are diverted from making sound financial decisions and reaping the positive rewards of well-managed investments. Our Sacramento broker fraud lawyers have seen the negative consequences of unwary investors utilizing, or even being deceived by, the wrong investment professional.
The Frankowski Firm helps investor clients to be more knowledgeable about broker fraud and prosecute the perpetrators. By educating the financial community, including both small-scale investors and larger scale investors, we aim for a more lawful, equitable, and professional industry as a whole. We work rigorously to help investors recoup their financial losses, when those losses came at the hands of an incompetent or negligent broker or brokerage firm.
What claims can be brought against fraudulent brokers?
Every investor has distinct needs and goals when investing their hard-earned funds. One investor may wish to focus on long-term, low-risk investments, while another may be more confident with risk and wish to focus on potentially larger returns. When a broker does not treat each investor client as an individual, or puts the pursuit of their own profit before the investor’s needs, broker fraud may occur in one of the following forms:
- Failure to diversify. A portfolio is intended to consist of a wide variety of investments types from various industries. When too many investments are clustered in one type or industry the portfolio risks serious and significant fiscal losses if that industry has an issue.
- Ponzi schemes. Beyond being wildly illegal and frequently in the news for infractions of the relevant statutes, Ponzi schemes only make money via new recruits buying in with new capital. When there are no more investors willing to buy in, the scheme collapses.
- Account churning. Brokers receive commissions on some transactions they perform for clients. However, the issue arises when they begin to make transactions purely to garner a commission, rather than to benefit the client in any way.
- Breach of fiduciary duty. Financial advisors owe a fiduciary duty to their clients to put the interests of the investor before their own and to act on their behalf accordingly. A broker or advisor who does not recommend suitable investments to a client may be guilty of a breach of fiduciary duty.
- Failure to supervise. Securities firms have an obligation to monitor the practices their brokers engage in to ensure compliance with FINRA and other regulations. Failure to do so implicates the firm when brokers are guilty of fraud.
- Selling away. Brokers may only sell the securities that their firm holds or is authorized to trade. Brokers are guilty of “selling away” when brokers sell securities that the firm does not hold. This breach of duty by the broker may be the result of a firm or manager’s failure to supervise.
- Suitability claims. The first duty of an investment broker is not to make money, either for the client or themselves; it is to apprise the client of potential choices that are aligned with that client’s investment goals, investment objectives and risk tolerances. Failure to prioritize this duty may result in suitability claims.
If you have been the victim of broker fraud, get the help you need today from experienced California stockbroker fraud lawyers.
Sacramento broker fraud attorneys guide investors through the steps to recover from broker fraud
Investors have rights. Negligence and incompetence by a broker can cause you significant harm. If you or a loved one is a victim of any Sacramento broker fraud, call The Frankowski Firm at 888.741.7503 or fill out our contact form to discuss your legal options.