Were You Improperly Sold a Structured Product?
Our Structured Product Attorneys Help Individual Investors Who Have Experienced Financial Losses
What are structured products? Structured products, generally, are investment vehicles based on or derived from a single security, a basket of securities, an index, a commodity, a debt issuance and/or a foreign currency. They have a fixed maturity date and are designed to offer specific risk-return tradeoffs, with pre-set formulas for both the potential risk and potential return. However, these calculations are very complex and well beyond the capabilities of most retail investors, making structured products unsuitable for average investors saving for retirement and other goals. Unfortunately, this unsuitability does not stop some brokerages and investment advisors from recommending them, because structured products can bring high commissions and profits to them.
Get Help from an Experienced Structured Product Lawyer
Not every product in the financial market is suitable for average investors. Complex structured products fall into this category, which is why disputes so commonly arise around these products in which average investors often lose money. If you lost significant money on a structured product you were improperly sold, our attorneys at Wolper Law Firm may be able to help you recover your investment. We have extensive experience handling claims involving structured products, and we have an overall 99% success rate in recovering money for wronged investors.
Our attorneys are committed to recovering investment losses. We recover money in over 99% of claims we handle. Call us today at 800.931.8452 to arrange a free consultation with a skilled structured product lawyer.
What Are Different Types of Structured Products?
Structured products come in many varieties, including market-linked notes, steepener notes, structured certificates of deposit and auto-call notes. Many of these products are sold to retail investors under the guise of being straightforward and traditional “bonds,” which they are not. They are complex derivative products that carry a significantly higher financial risk to individual investors than do traditional bonds. The following description of auto-call notes, one of the most common and popular structured products that lose investors money, highlights the risks structured products carry.
Autocallable Structured Products
Auto-call notes are complex synthetic investments created and issued by financial institutions and sold to retail brokerage customers. While every issuer of auto-call notes uses different verbiage within their offering materials, the mechanics of these products are the same. The investor purchases the auto-call note, which typically offers an above-average income stream, sometimes upwards of 10%. This is known as a “teaser” rate.
The notes have a fixed maturity date upon which an investor, in theory, will receive a return of principal. However, both the income stream and the ability of the investor to receive a return of principal are correlated to either underlying stocks or indices referenced within the prospectus of the auto-call note. To the extent the underlying stock or index depreciates in value below a certain threshold, often referred to as a “barrier,” the income stream may be eliminated and the principal value lost.
Importantly, most auto-call notes can be “called” or redeemed by the issuer prior to the maturity date. The impact of this is immense. If the auto-call note happens to perform in a way that is advantageous to the investor, the issuer may, at its election, redeem the investment so that it does not have to continue paying the higher interest rate. In other words, the house always wins.
Auto-Call Notes and Other Structured Products Are Lucrative for Financial Advisors
As you can see, auto-call notes can be lucrative for financial advisors to sell to investors. Brokerage firms have incentivized their brokers and financial advisors by offering them selling commissions of approximately 3%-4%. This commission structure further underscores the economic inefficiency of these products for retail customers. But it does not stop some brokers from pushing auto-call notes and other complex structured products.
If an auto-call note performs in a way that is advantageous to the investor, the issuer may elect to call the investment to avoid paying the higher interest rate. In other words, the house always wins.
Why Choose Our Law Firm When You Have Lost Investment Money?
Wronged investors consistently choose Matt Wolper and Wolper Law Firm to help them recover their money because of our strong record of success and our years of experience standing up to dishonest and unethical brokers and brokerage firms. Read what satisfied clients have to say about our services.
Here is more that you should know about us when you are considering structured product attorneys to handle your investment loss claim:
- We have a 99% recovery rate for wronged investors.
- We have recovered millions of dollars for investors.
- We have decades of legal experience in the securities industry.
- We know how brokers operate because we used to defend the brokerages we now sue.
- We provide personalized service and are available 7 days a week.
- We offer free initial consultations in a low-pressure environment.
Call Wolper Law Firm today at 800.931.8452 to arrange a free case evaluation from an experienced structured product attorney.
Structured Product FAQ’s
Contact Our Attorneys Directly with Your Specific Concerns
In the following section, we answer common questions about structured products. To have concerns addressed about your specific situation, reach out to our law firm to schedule a free consultation.
Here are some circumstances in which you may have a valid investment loss claim against a broker:
- The structured product investment and its risks were not clearly explained to you.
- Structured products were not suitable for your risk tolerance and goals of your investment portfolio.
- Your broker did not do their homework or “due diligence” in reviewing the product that they sold to you and which turned out to be fraudulent or have other problems.
- Your advisor gave you misleading or inaccurate information about the investment.
- Your broker recommended the product with their interests in mind — i.e., high commissions — rather than your best interests.
If you have any suspicion that an investment was not clearly explained to you, that you were misled about it or that your advisor knew it was too risky for your portfolio and goals, reach out to our attorneys. We will review the facts of the situation and advise you about your options for filing a claim.
Most investment loss claims are resolved through arbitration or mediation with the Financial Industry Regulatory Authority (FINRA). FINRA oversees brokerages and brokers in the United States. In FINRA arbitration, one or three arbitrators, depending upon the amount of the losses claimed, hear the arguments and evidence from both sides and then decide the outcome. Once arbitrators make a decision, it is binding, meaning that it cannot be appealed. Sometimes, if both sides agree to mediation, claims may be settled that way and not go to arbitration unless mediation is not successful. Additionally, for some investors, suing in court may be an option if the customer agreements they signed with their brokerage firms do not bind them to arbitration, which most brokerage agreements do.
Claims that go to arbitration generally take around 16 months to be resolved, according to FINRA. Settlements through FINRA mediation take a shorter period of time–approximately one year. Once awards and settlements are made, FINRA requires that brokerages/brokers must pay investors within 30 days. If they do not pay within this timeframe, their licenses may be suspended or cancelled. Cases that go to civil trial typically take significantly longer because the process is more involved and there is an appeals process. If a decision is appealed, it could take years for a lawsuit to be resolved. Our structured product attorneys have extensive background successfully resolving investment loss claims through FINRA arbitration. We are also skilled litigators who fight for investor clients in the courts. Contact us to learn more about your options for recovering your money. Call 800.931.8452 to set up a free consultation.
You are not required to hire an attorney to take your auto-call note claim or other structured product claim to FINRA arbitration or to the courts. However, in either case, you will put yourself at a distinct disadvantage without the help of an experienced attorney who understands the securities market and the complexities of structured products and why they are not typically suitable for the average retail investor. And you can be sure that the brokerage house and broker you are making the claim against will have a team of highly knowledgeable investment industry attorneys arguing on their behalf. Our structured product lawyers have worked on both sides of the industry—defending brokerage houses and now exclusively standing up for the rights and interests of individual investors. This comprehensive experience provides us in-depth insight into the intricacies of the industry and how brokerages operate, which serves to benefit our clients’ cases.
How We Will Help You When You Have Lost Money on a Structured Product Due to Fraud or Negligence
Brokers and advisors are supposed to look out for the financial well-being of their investor clients. When they fail to do so, either through intentional fraud or through negligence, they can be held accountable. When you trust us to hold your broker to account for your investment losses we will:
- Carefully review all of the evidence involved to build a strong case against your broker for fraud or negligence.
- Prepare and file all the paperwork necessary for filing a claim with FINRA or the courts.
- Be available to answer your questions and address any concerns you have about your case and the claim process.
- Argue on your behalf before arbitrators or a judge.
- Advise you throughout the entire claims process.
You will find when you work with our firm that our attorneys are passionate about helping investors who have been taken advantage of by dishonest or inept brokers. Reach out for dedicated help today.
Contact Our Structured Product Lawyers for Wronged Investors
The Wolper Law Firm has extensive experience handling claims involving structured products and other commonly disputed investments. If you believe that you were improperly sold a structured product such as an auto-call note, market-linked note, market-linked certificate of deposit or other unsuitable investment, please contact our attorneys for a free consultation and case evaluation. We have recovered money for wronged investors in 99% of cases we have handled.
Reach out to our office by phone at 800.931.8452 or through the convenient contact form we have included on this page to schedule a free, no-obligation consultation. You can contact us seven days a week for help.
Attorney Matthew Wolper
Matt Wolper is a trial lawyer who focuses exclusively on securities litigation and arbitration. Mr. Wolper has handled hundreds of securities matters nationwide before the Financial Industry Regulatory Authority (FINRA), American Arbitration Association (“AAA”), JAMS, and in state and federal court. Mr. Wolper has handled and tried cases involving complex financial products and strategies ranging from traditional stocks and bonds to options, margin and other securities-based lending products, closed/open-end mutual funds, structured products, hedge funds, and penny stocks.
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