The Jeffcoat Firm helps victims of securities and stockbroker fraud fight back. We understand how securities and stockbroker fraud can disrupt your plans and throw your financial future into chaos.
We’re here to help. We can work with investigators and regulators to discover what happened. We’ll find the answers you need, and we’ll fight for you every step of the way.
At The Jeffcoat Firm, we pride ourselves on the legal skill and talent we bring to every case. Whether we’re representing clients in investigations, negotiations, arbitration, or even a court trial, we know what it takes to win.
We help stockbroker fraud victims in Columbia and Lexington and throughout the state of South Carolina. If you’re a victim of securities or stockbroker fraud, contact us for a free consultation about your case. Call us or use our online contact options today.
What Is Securities and Stockbroker Fraud?
When you’re investing, always gather as much information as you can about an investment before you put in your hard-earned money. There are many fraudulent actors in the investment field. Despite government regulation, serious criminal penalties, and dedicated industry groups, it’s still easy to end up a victim of fraud.
If you’re considering an investment, never be afraid to ask questions. If you suspect you’ve been defrauded, never be afraid to ask a stockbroker fraud lawyer for help.
Some common forms of securities and stockbroker fraud include:
- Churning, also known as excessive trading. Churning is an illegal practice where stockbrokers make an inordinate number of trades on an account to generate commissions for themselves. It can be challenging to identify churning since trading must happen on accounts. Investigators will look at every transaction, the average number of transactions, and many other characteristics when investigating churning allegations.
- Omission and misrepresentation of facts. Stockbrokers and other investment professionals are required to provide you with key information about an investment. However, some brokers engage in the illegal and unethical practices of omission and misrepresentation. They do this to illegally earn commissions or accrue other benefits that they shouldn’t be entitled to. Brokers may leave out relevant information or try to spin information in an unethical way that entices an investor to put their money in.
- Ponzi schemes. Ponzi schemes need a constant stream of new investors to pay off older ones because the “investment” doesn’t actually produce revenue. Money is taken from the new investors and given to the old investors to provide the scheme a veneer of legitimacy and to entice the older investors to invest even more money in the scheme. Scheme operators typically hide information from investors and do everything they can to prevent investors from asking tough questions. Ponzi schemes eventually collapse due to insufficient income.
Common Signs of Securities and Stockbroker Fraud
Sometimes it can be difficult to detect securities and stockbroker fraud. All investments carry some level of risk, and any investment can turn out badly. However, as an investor, you have a right to truthful and complete information about an investment. Always ask questions before investing, and look for the following signs to help identify potential securities and stockbroker fraud:
- The broker avoids answering your questions or giving you the information you need. Frauds thrive because people take “no” for an answer. As an investor, you’re entitled to many important pieces of information about where your money is going. Be alert for fraud when a broker won’t give you what you ask for, avoids your calls, or tries to placate you with promises that they’ll provide the documents later. An honest broker will provide all required documentation before and during an investment.
- The broker pressures you to invest even though it may not be right for you. They may mislead investors, omit important information, or misrepresent the terms of an investment in order to get you to buy in. Remember that brokers often earn commissions off of the investments they secure. High-pressure sales are a common sign that a broker is not doing what’s best for you, but what’s best for themselves.
- Little to no information about how an investment earns money. An honest broker will provide you with clear information about how your investment should work. If a broker cannot, or will not, provide you with clear, straightforward information about how an investment works, then it may be a sign of fraud. Remember that, when investing, you should always understand what you’re putting your money into. Get information in writing, review it as needed, and never give into pressure to make a snap decision.
- Claims that there’s no risk. No matter what type of investment you’re looking at, there are inherent risks. An honest stockbroker will layout the known risks and foreseeable risks that may happen in the future. Unethical brokers offer investments that hide the actual amount of risk in an investment. If you are offered an investment opportunity with promises of high reward and little risk, be on the alert for fraud.
Regulation of the Financial Industry
Securities and stockbroker fraud are serious and ongoing problems. The good news is that there are many government and industry organizations that work to combat fraud and help investors protect themselves.
Two of the most important organizations are the:
- U.S. Securities and Exchange Commission (SEC). A federal government regulator tasked with oversight of the financial sector.
- Financial Industry Regulatory Authority (FINRA). An industry group created to improve the safety and security of financial markets.
Many states also have investment and securities organizations that manage marketplaces. If you suspect that you are a victim of securities or stockbroker fraud, a securities fraud attorney can help you understand what organizations should be involved and how they can help.
Helping You Fight Securities and Stockbroker Fraud
The Jeffcoat Firm understands what securities and stockbroker fraud means, and how it can affect your finances and your future. No matter what type of fraud you’ve suffered, our experienced securities and stockbroker fraud lawyers know how to pursue the recovery that you need. When you work with The Jeffcoat Firm, you’ll have experienced securities fraud lawyers who will take action to protect you, your family, and your investments.
If you suspect fraud or have been the victim of fraud, don’t wait to get the help you need. Contact us today for a free consultation about your case.