Can you sue your financial advisor? You may have the chance to file a lawsuit or arbitration claim against your financial advisor in cases involving investment misconduct. An investment fraud lawyer from our team at Meyer Wilson can help you determine if you’re eligible to take this step. Our firm may also discuss other methods to resolve cases involving financial misconduct.
Call or complete our online contact form to learn more.
When Can You Sue a Financial Advisor?
You may have a chance to sue your financial advisor if this individual engaged in misconduct that directly caused you economic losses. For example, you may have the opportunity to file a lawsuit or arbitration case if the advisor:
Financial advisors have a duty to provide you with factual and complete information. When they omit or misrepresent information, you may be sold inappropriate investments that cost you money. In this situation, you may have a chance to sue the financial advisor.
Engaged in Churning
Sometimes, financial professionals engage in churning or the excessive purchase and sale of securities. They take this step to generate more commissions to increase their pay. In some cases, you may file a lawsuit or arbitration to address churning.
Participated in Hedge Fund Fraud
Financial professionals may avoid fully explaining the risks of a hedge fund or making misleading statements to convince clients to invest in these funds. In this situation, you may file a claim for compensation.
Set Up a Ponzi Scheme
Ponzi – or pyramid – schemes suck in many people every year, resulting in significant financial losses in many cases. Depending on the circumstances, an investment fraud lawyer maye be able to help you build a claim after this kind of misconduct.
Failed to Follow Your Instructions
Sometimes, financial advisors engage in failure to execute by refusing to follow the instructions you provided for your investments. You could have legal options to seek compensation after this action.
Poorly Allocated Your Assets
Sometimes, you can face financial losses even if your financial advisor avoided intentionally fraudulent actions. For example, perhaps your advisor failed to appropriately allocate your assets, putting you in a position to lose your savings.
In this situation, you may have the option to sue them. Generally, you may have this option anytime an advisor engages in negligence or misconduct, costing you money.
Skimmed Funds From Your Account
Sometimes, financial advisors engage in “skimming.” They complete this process by taking funds from an investor’s account and keeping the money for themselves. You can seek compensation if you are a victim of this type of theft experience this white-collar crime.
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What Determines If You Can Sue Your Financial Advisor?
If your financial advisor engaged in misconduct and cost you money, can you sue them? In many cases, the answer to this question depends on the contract and paperwork you signed when you hired the advisor.
Some financial professionals include clauses in their paperwork that ask you to decline your right to file a lawsuit in the event of misconduct or negligence. Instead, you agree to resolve the issue through the Financial Industry Regulatory Authority (FINRA) arbitration.
The arbitration process can allow you to secure compensation for your losses, even if you cannot file a lawsuit against your financial advisor. Your attorney can review relevant documentation to see if you’re eligible for a claim.
How does FINRA Arbitration Work?
Around 95% of cases involving investment misconduct against brokerage firms go through the FINRA arbitration process instead of civil court. The arbitration process resembles the steps you’d take in a lawsuit in many ways.
Your attorney can review your claim, gather evidence, and present the evidence to the FINRA arbitration panel. The arbitrators will consider the facts surrounding your claim of misconduct and make a binding legal decision.
Depending upon the facts of your case, the FINRA arbitration board may provide you with compensation for the funds you lost during investment misconduct.
How Is FINRA Arbitration Different From a Lawsuit?
While FINRA arbitration resembles a lawsuit, there are differences. Generally, arbitration provides a faster and more streamlined process to resolve disputes. However, it may also limit available forms of compensation for your losses.
You can learn more about arbitration and lawsuits by contacting our team for legal assistance.
Our lawyers are nationwide leaders in investment fraud cases.
Speak to Us About Suing Your Financial Advisor
Can you sue your financial advisor? In some cases, yes, you have a chance to file a lawsuit after investment misconduct, especially in situations involving negligence. However, you may have to seek compensation through FINRA arbitration in some cases.
An investment fraud lawyer from our team at Meyer Wilson can review your situation and provide information about your specific options. Discuss methods to secure compensation for your losses by calling or filling out our online contact form.
Recovering Losses Caused by Investment Misconduct.