If you are an individual or institutional investor in Miami whose portfolio has experienced losses because of a stockbroker or financial advisor’s misconduct, you aren’t alone.
Miami is a major center for domestic and international investment activity, teeming with advisors ranging from independent agencies to major brokerage firms.
Again and again, many of these brokers and advisors let their clients down. Some are inexperienced, some are inattentive, and some are downright dishonest. None of those things are your fault, and you shouldn’t have to sustain financial losses because of them.
In fact, stockbrokers and investment advisors are entrusted with some of the highest legal duties in the entire country. From the moment you hire them or receive their advice, they owe you what is called a fiduciary duty.
While the concept of a fiduciary duty is nuanced, the essence of the duty requires your broker or advisor to put your interests ahead of their own. This means:
- They must fully understand your investment objectives and risk tolerance
- They must gather and disclose to you all material facts regarding an investment prior to recommending its purchase or sale
- They must only recommend suitable investments.
In other words, your investment advisor should be looking out for you. In order to meet their obligations, financial advisors are expected to work diligently to protect you from future financial risks.
If you are a Miami resident, and a stockbroker or financial advisor has given you bad advice, mishandled your investor account, or committed fraud, you may be entitled to full compensation for all your losses. A Miami securities litigation attorney can help.
At the Wolper Law Firm, P.A., we spend each day fighting for the financial rights of individual and institutional investors in Miami. Matt Wolper spent 14 years representing the largest, most successful brokerage firms and banks on Wall Street. Simply put, he knows how the other side thinks and will develop arguments and legal strategies to best position your claim for success.
When you hire a Miami securities lawyer in our firm, you can count on us to fight for every penny you’re owed. Reach out to the Wolper Law Firm, P.A. today.
Victims in Miami of Fraud or Misrepresentation
Investment and securities fraud is illegal under both federal and Florida state law. At the heart of investment fraud is an illegal misrepresentation or omission of a material fact.
A fact is material if a reasonable investor would have wanted to know about it before deciding whether to buy, sell, hold, or trade a security.
The law boils down to this: you have a right to know all of the facts affecting your money before taking a risk. If your broker or advisor failed to fully advise you of the potential risks (including the pros and cons, the cost of their commissions, and any potential conflicts of interest), you might have a case for investment fraud. A Miami securities litigation lawyer can help you get your money back.
Victims in Miami or Breach of Fiduciary Duty
The law recognizes a fiduciary duty in situations where there is a special relationship of trust between two parties. The investor-broker relationship is one of those special arrangements, where you as the investor have agreed to put your trust in the expertise of a brokerage firm or investment advisor.
The law provides robust protection and enforcement for that trust. A Miami investment litigation attorney can help you meaningfully avail yourself of those protections.
Any action by a broker that is incongruent with their fiduciary duty — that is, the duty to put your interests first and to act in good faith — may be sufficient for bringing a breach of fiduciary duty claim.
Victims in Miami Who Have Been Sold Unsuitable Investments
When brokers recommend investments, they have a duty to conduct due diligence on each such investment in order to determine whether it makes sense for you. In other words, the investment must be suitable.
“Suitability” means the investment makes sense:
- For any retail investor. In other words, you should not sell complex investment products to ordinary retail investors when those products are traditionally designed for institutional investors
- For you as a unique individual investor, taking into account your entire investment profile, investment objectives and risk profile
- In light of the cost, commissions or fees charged. In other words, the investment returns of the investment must not be outweighed by the costs and other risk factors
Recommendations falling outside these guidelines are generally considered to be unsuitable investments. A Miami securities litigation & arbitration attorney can help you recover for losses caused by unsuitable recommendations.
Miami Elder Abuse
Miami is home to a large population of both private investors and senior citizens. Unsurprisingly, there is considerable overlap between those two groups. Elderly investors are among the most common victims of financial fraud, which is recognized as a form of elder abuse.
Many people would be surprised to learn how common elder investment fraud is in Miami — and the measures that duplicitous financial advisors will take to dupe unsuspecting seniors, especially those with deep pockets.
If you suspect that you or your loved one have been taken advantage of, the Wolper Law Firm, P.A. can help.
Lack of Diversification
A financial advisor or broker has an obligation to diversify your investments in order to fulfill his or her fiduciary duty.
Diversification of investments is a critical safeguard against the unpredictability of markets. Diversification and asset allocation is the cornerstone of sound investment advice. Inexperienced and unscrupulous financial advisors frequently fail to diversify their clients’ accounts, which can lead to catastrophic losses.
Generally speaking, an investment portfolio should be diversified across:
- Asset classes
- Types of investment
- Geographic regions
If you are a Miami resident, and you have experienced investment losses due to a lack of diversification, you might have a strong claim for reimbursement against your financial advisor and the Wolper Law Firm, P.A. can help.
Margin is an account feature that allows investors to borrow money against the value of their securities, which collectively serve as collateral for the margin loan.
Many individual and institutional investors in Miami and throughout the United States do not fully understand the risks associated with margin and their financial advisors do not adequately explain them.
Nevertheless, many brokerage firms recommend margin accounts to their clients, and many clients follow their advisor’s advice. This is concerning because while margin trading can magnify your returns, it can also magnify your losses. Worse, it could wipe out your entire account.
If your broker made a trade on margin without your permission or without adequately informing you about the risks, you should contact a Miami securities litigation attorney as soon as possible.
Churning happens when investment brokers recommend an excessive number of transactions for their clients — not because it benefits the client but because it yields larger commissions for the broker.
Churning is hard to spot and it’s easy for brokers to disguise or hide. In an appreciating market, a financial advisor can actually churn or excessively trade your account and it may still reflect profits in the underlying investments. What investors may not know is that the cost of transactions has significantly impacted their investment returns, which could have been higher but for the excessive and unwarranted trading.
At the Wolper Law Firm, P.A., we can identify churning and excessive trading by analyzing your account statements. If you believe that you have been a victim of churning or excessive trading, please contact the Wolper Law Firm, P.A. for a free consultation.
Representation in Miami Securities Arbitration
If you maintain a brokerage account, it is very likely that your customer agreement includes an arbitration clause that requires you to bring any claims you have in arbitration before the Financial Industry Regulatory Authority (FINRA). Arbitration is a process similar to a trial, though slightly less formal, with its own rules of procedure.
If you have experienced investment losses, it is imperative that you contact an experienced arbitration attorney, who can evaluate your claims and determine the appropriate forum to resolve the dispute. At the Wolper Law Firm, P.A., that is what we do. Matt Wolper is an experienced arbitration attorney that has handled hundreds of arbitrations involving a wide range of securities related matters.
What If I’m Not Sure If I Have a Case?
That’s okay. Most securities fraud schemes purposely target unsophisticated investors, a category that accounts for the overwhelming majority of individual investors in Miami.
If your investment portfolio has experienced a sharp or sudden decline in value, or had underperformed your expectations, this may be a sign of possible negligence or fraud.
If you have experienced investment losses, you are But the best way to know whether you are a victim is simply to call our office and talk. You should always review a potential legal claim with an experienced attorney before reaching any decisions about your legal rights.
Can Miami Brokerage Firms Be Held Responsible for Their Employees’ Actions?
In many cases, yes. The law recognizes a claim known as failure to supervise, which individual investors can bring against brokerage firms for negligent or fraudulent conduct by the brokers or advisors they employ.
Firms cannot turn a blind eye to misconduct. In fact, they have a duty to monitor the accounts within their firm and to run checks for red flags. When warning signs arise, the firms have a duty to take action.
In other cases, the firm itself might be complicit in negligence or fraud. In either scenario, our law firm can help.
The Wolper Law Firm, P.A. Also Represents Honest Financial Advisors In Miami In Regulatory, Employment And Compliance Matters
The Wolper Law Firm, P.A. understands that many Financial Advisors in Miami are honest, thoughtful and diligent students of the financial markets. Many Financial Advisors provide comprehensive guidance to their customers and are “value added.” Notwithstanding their efforts, Financial Advisors may still find themselves with regulatory or compliance problems.
The financial markets are cyclical and go through periods of appreciation followed by periods of decline. If a Financial Advisor correctly allocates his or her client’s portfolio, it should be protected against significant fluctuations in value. However, a client may still file a customer complaint against the Financial Advisor, which remains on their CRD unless and until is expunged through a formal expungement proceeding filed with the Financial Industry Regulatory Authority (FINRA). The Wolper Law Firm, P.A. can help Miami Financial Advisors navigate these complex issues when they arise and even assist in the expungement of unwarranted complaints from their Form U-4 disclosure documents maintained with the Central Registration Depository, or CRD. Matt Wolper has handled expungements for Financial Advisors all over the country.
Separately, when a Miami Financial Advisor becomes at odds with his or her employing brokerage firm, it is necessary that an attorney is consulted and retained. This often occurs when the brokerage firm eliminates a line of business that is crucial to the Financial Advisors’ financial well-being. It also occurs when the brokerage firm makes promises to Financial Advisors in order to lure them from competitors. These promises can include money, assistants, or access to certain trading desks and products. If the brokerage firm retracts its promises, and leaves the Financial Advisor in an untenable position, counseling with a securities attorney at an early stage is critical. This conduct by the employing brokerage firm may constitute a violation of the employment laws, including anti-discrimination statutes, and wage and hour statutes. It may also rise to the level of constructive discharge or wrongful termination.
The Wolper Law Firm, P.A. can help counsel Financial Advisors regarding disputes with their employing brokerage firm and, if necessary, litigate your employment case through the trial phase. If you are a Financial Advisor in Miami, and you have regulatory, compliance or employment issues or disputes, contact the Wolper Law Firm, P.A. for a free consultation and case assessment.
Schedule a Free Consultation with a Miami Securities Litigation & Arbitration Attorney
If you or your loved one has suffered investment losses in Miami or the surrounding area, and you believe a stockbroker or financial advisor is to blame, please contact the Wolper Law Firm, P.A. as soon as possible.
Call 800.931.8452 to schedule a free, no-obligation consultation today.