The term “securities lawyer” refers to an attorney who concentrates his/her practice on assisting clients in navigating the laws and regulations that govern the purchase and sale of securities. If you’re having difficulties with your financial advisor or broker and suffered investment losses, you might want to hire a securities lawyer who knows the securities laws and securities industry rules inside and out. Brokers and advisors provide investment advice and sell securities products such as stocks, bonds, and mutual funds. When you work with an advisor or broker, you probably signed an agreement that required them to comply with Federal and state securities laws and securities industry rules, including the rules requiring an advisor or broker to only make suitable investment recommendations and to act in your best interest. IMPORTANT: If your financial professional isn’t doing what was agreed to, or if you think they’ve committed securities fraud, you can file a complaint with the Financial Industry Regulatory Authority (FINRA). But before you do, you might want to talk to a securities lawyer. You have the right to seek compensation from the parties responsible if you were an investor who lost money as a result of broker misconduct. What Does a Securities Lawyer Do? A securities lawyer specializes in securities laws and regulations that apply to investors, brokers, and financial advisors. Securities lawyers represent investors claiming losses as a result of misconduct or fraud, as well as brokers and financial advisors accused of misconduct by their clients or their employers. Investment Losses? Let’s Talk. or, give us a ring at 800-732-2889. What Are Securities Laws? Securities laws are the laws that regulate the securities industry. The SEC (Securities and Exchange Commission) is the government agency that oversees the securities industry and enforces the Federal securities laws. These rules are designed to protect investors from fraud and other abuses, and to ensure that the securities industry operates fairly and transparently. Federal law requires companies that sell securities to register with the SEC. This registration process provides important information about a company’s business, its financial condition, and its management. It also gives the SEC important information about the people who sell the company’s securities. The federal securities laws also require those who sell securities to be licensed and to meet other standards of conduct. Investors and brokers use this information to make informed investment decisions. When brokers don’t disclose important information, or make false or misleading statements, they may have committed securities fraud. Further, the SEC provides a forum where investors can bring SEC complaints. The SEC may use these complaints to assist them in SEC investigations and the detection of securities fraud. In comparison to other areas of the law in the United States, there are few securities lawyers. Most lawyers who practice in this area work for the government, regulating or prosecuting firms and individuals who have violated securities law. It’s Important To Find A Good Securities Lawyer Who Represents Investors! There are a few lawyers who represent investors in private lawsuits and arbitrations against firms or individuals who have committed fraud and violated other securities laws. In order to sue someone for securities fraud, you must be able to prove that they made false or misleading statements, and that you relied on those statements to your detriment. Proving fraud can be difficult, and you should talk to a securities lawyer before you decide whether to sue. If you are an investor who suffered losses due to broker misconduct, you have the right to seek reimbursement from the parties responsible. Broker misconduct exists in multiple forms, including: While some forms of broker misconduct are easy to recognize, others are not. A financial advisor who stole funds out of your account and transferred them to a personal account clearly misappropriated your funds and committed misconduct. It’s more difficult to prove that a financial advisor recommended unsuitable investments, however, because the suitability of an investment depends on a number of different factors. If you suffered investment losses and believe it was a result of broker misconduct, contact a good securities fraud lawyer today to evaluate your case. Securities Laws are Complex and Numerous The laws that govern the securities industry are complex and numerous. This is partially due to the fact that the securities industry is complex and ever-changing. As new technologies and products are developed, they must be regulated. And as the markets change and evolve, the rules must change with them. This complexity can make it difficult for investors to understand their rights and what they should do if they think their broker has committed securities fraud. Below are just a few of the securities laws that may be relevant to your case: The Securities Act of 1933 Often called the “truth in securities” law, the Securities Act of 1933 has two main objectives: You can read more about the Securities Act of 1933 here. The Securities Exchange Act of 1934 The Securities Exchange Act of 1934 is often called the “most important securities law in the United States.” It created the SEC and gave it broad authority to regulate the securities industry. Among other things, the Securities Exchange Act of 1934 requires companies that sell securities to the public to disclose important information about their business, financial condition, and management. It also requires brokers and dealers who trade securities to be licensed and to meet other standards of conduct. You can read more about the Securities Exchange Act of 1934 here. Trust Indenture Act of 1939 The Trust Indenture Act of 1939 is a federal law that regulates the sale of municipal securities. Municipal securities are debt obligations issued by states, cities, and other government entities. The Trust Indenture Act of 1939 requires state and local governments to disclose important information about their finances before they sell municipal securities. It also prohibits them from selling municipal securities unless they comply with certain conditions. You can read more about the Trust Indenture Act of 1939 here. Investment Company Act of 1940 The Investment Company Act of...
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Growing up, one of the lessons we’re all taught is to respect our elders. Unfortunately, many people fail to take this to heart. Unscrupulous family members and other bad actors often take advantage of senior citizens, especially when it comes to their finances. According to one study, elder financial abuse accounted for roughly 18% of elder abuse reports. However, the actual percentage is likely much higher; only about 1 in 44 financial abuse cases is ever reported. Because many elderly people live off of their investments, the consequences of this type of abuse can be particularly extreme. The best way to protect our elderly family members is to know the signs of elder financial abuse. By recognizing the abuse as soon as possible, we can hopefully prevent irreversible damage to their finances. In this article, we will cover everything you need to know about elder financial abuse. What Is Elder Financial Abuse? Elder financial abuse is theft or mismanagement of an elderly person’s assets and/or investments. These may include real estate, bank accounts, or other property that belongs to the elderly person. Need Legal Help? Let’s Talk. or, give us a ring at 800-732-2889. Because the abuser is often a close family member, or trusted financial advisor, elder financial abuse frequently goes unnoticed. If you or someone you know is a victim of elder financial abuse, it’s important to act quickly. The elder financial abuse attorneys at the Law Offices of Robert Wayne Pearce, P.A. can help walk you through the process to protect your rights and interests. Contact us today to schedule a consultation. Signs of Elder Financial Abuse and Exploitation At the Law Offices of Robert Wayne Pearce, P.A. we have seen firsthand the effects of elder financial abuse. Spotting the signs of elder financial abuse can be tricky, but it’s important to learn how to recognize them so that you can protect your loved ones. The following are some common signs of elder financial abuse and exploitation: Sign 1. Unusual Bank Account Activity As they get older, many people grant financial powers of attorney to their spouse or adult children or trusted financial advisors. While this is perfectly normal, it opens up the possibility that the designated person may abuse that power. If you suspect elder financial abuse, pay close attention to the elderly person’s bank accounts and investments in their brokerage accounts. Withdrawals, transfers, or other suspicious activity like new or inactive accounts suddenly becoming active are red flags. The elderly person may be making these transfers themself, but it’s always good to be sure, since it could be for the wrong reasons (like the internet scams discussed below). Keep an eye on their investments as well. An elderly person’s portfolio is typically structured to provide a livable income off interest alone through low-risk investments. Keep an eye out for restructuring of investments to riskier funds or unexplained “cash outs.” Sign 2. Suspicious Internet Activity Over the past few years, there has been a drastic increase in the number of online scams targeting elderly people. Because elderly people are more trusting and less able to distinguish a scam from a legitimate venture, scammers frequently target them with fake tech support calls and the like. One of the most common online scams involves the scammer posing as a lover, friend, or family member online. After contacting the elderly victim, the scammer then requests money for plane tickets or some kind of emergency. This sign may be impossible to notice without speaking to the potential victim. Be wary if they mention someone new they met online or if you notice suspicious financial activity initiated by the victim. Sign 3. Missing Food or Unpaid Bills Ordinarily, caregivers or family members will make sure that an eldery person’s home is stocked with food and that bills are paid on time. Especially in a world with automatic bill payments, aging parents shouldn’t have to worry about paying their bills on time. A lack of food in the house and unpaid bills are indicators that that money is going elsewhere. Sign 4. Frequent Requests for Money by Someone Close to the Victim If someone makes frequent demands for money, that could be an indicator of financial exploitation. Anyone from neighbors to adult children may try to make frequent requests for money because they know the victim may have a poor memory or may have difficulty saying no. Keep in mind that elder financial abuse like this is often subtle. Demands may not always be for large amounts of cash; this sign also includes polite requests for small amounts here and there. Over time, however, those “small amounts” can become exploitative. Sign 5. Payment for Unnecessary Services Door-to-door salesmen and “cold callers” may try to a upsell your elderly family member on services they don’t want or need. One common example of door-to-door sales abuse is roof repair or landscaping work. Cold callers barrage elderly at home with the next best investment in gold, silver, diamonds, and the next supposed Apple, Amazon, or Nextflix investment opportunity to get into before its too late! These scams can take many different forms and may be difficult to spot. Sign 6. Threats or Coercion It may be difficult to imagine, but people may threaten their elderly family members to obtain money. These threats usually do not involve force, but rather things like, “I will put you in a home” or “I will stop visiting you.” If you don’t buy this stock, I’ll never call you again with any investment opportunities. The abuser may also instruct the victim not to tell anyone what is happening. As a result, you’ll often have to pay close attention to spot this sign of elder financial abuse. Watch for a change in the elderly person’s demeanor or mood, especially around a suspected abuser. What to Do If You Suspect Elder Financial Abuse If you suspect your loved one is the victim of elder financial abuse, there are a couple things you can...
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CRD, or Central Registration Depository, is a comprehensive database maintained by FINRA of all registered securities professionals and firms, providing an invaluable resource for investors. Investors can use a CRD number to access information about any broker or investment advisor, including their employment history, qualifications, examinations taken and passed, licenses held, disciplinary actions and more. Brokers and brokerage firms must register with the Financial Industry Regulatory Authority (FINRA) before they can legally sell securities in the United States. By maintaining a registration system, FINRA can better monitor and record the activities of registered brokers. These registrations are also open to the public, so investors can review the backgrounds of potential brokers before entrusting them with their money. You can look up your broker and brokerage firm by using their unique CRD (Central Registration Depository) number. What Is a Broker CRD Number? CRD stands for the Central Registration Depository. CRD numbers are unique identification numbers assigned by FINRA to registered brokers and brokerage firms. You can use the CRD number to look up a broker or brokerage firm’s disciplinary history, qualifications and other detailed information. Investment Losses? Let’s Talk. or, give us a ring at 800-732-2889. Central Registration Depository (CRD) & FINRA FINRA manages the Central Registration Depository (CRD) program. This program covers the licensing and registration of individuals and firms in the securities industry in the United States. When a broker or firm registers with FINRA, the regulator assigns them a CRD number. Investors can use a broker’s CRD number to check that broker’s work history and disciplinary record using BrokerCheck. A broker’s profile on BrokerCheck will contain useful information for investors. On any given profile, investors can find information related to Complaints and regulatory actions are called “disclosures,” and investors can see details about each one using BrokerCheck. If the claim was settled, BrokerCheck displays the settlement along with the claimed allegations and the broker’s response, if any. Why It’s Important to Investigate a Potential Broker An investment broker is responsible for handling a significant portion of your assets. For that reason, you should learn as much about them as possible before giving them control. Doing your research before handing over your money can save you time and stress in the long run by helping you avoid unscrupulous brokers. If a broker’s disclosure history shows several complaints, each of which the broker denies, you can make the decision to move on or bring up your concerns. In any case, having more information about your broker’s past allows you to make a smarter decision about who is managing your money. How to Find a Broker’s CRD Number Before engaging a broker, you have the legal right to request their CRD number. If a broker refuses to provide this information to you, stop and find another broker to work with. Any broker unwilling to give you their CRD number likely has something to hide and is probably not someone with whom you want to invest. While asking your broker directly is the fastest way to get their CRD number, the information materials and agreement you receive before engaging your broker will likely contain this information as well. Regardless of how you obtain it, searching your broker’s CRD number is an important step when hiring a broker. How to Do a FINRA BrokerCheck CRD Number Search Finding information about a broker or firm in the past used to be a hassle. Fortunately, BrokerCheck makes it easy to research a broker with whom you want to invest. After visiting the BrokerCheck website, there are a few things you can do to check out a broker or firm. Search by CRD Number, Broker, or Firm Name Using the “Individual” or “Firm” search options, you can search for your broker by CRD number or name. Because many brokers may have the same or similar names, using a CRD number ensures that you find the right BrokerCheck report. You can also search for a specific brokerage firm using its CRD number or name. Doing so will return a report with much the same information as a broker search. Additionally, you can see a list of the direct owners and executive officers of the firm and information about when the firm was established. Examine Your Broker’s Employment History and Experience In the “Previous Registrations” section of the BrokerCheck report, you can see a chronological list of the firms with which the broker was previously registered. If you are concerned about gaps in employment or short tenures, you can discuss them with your broker. Check Your Broker’s Licenses and Exam History BrokerCheck also provides a comprehensive list of the examinations and licenses your broker has obtained. In addition to FINRA registration, your broker may have broker or financial adviser registrations in other states. The “Examinations” section shows you the date and type of exam your broker passed. If you are interested in a specific type of security or curious about the broker’s overall certification status, you can check that there. Read Through Any Disclosures BrokerCheck disclosures cover not only customer disputes and disciplinary actions but employment terminations, bankruptcy filings, and criminal and civil proceedings as well. If a broker was the subject of a court-ordered lien or other debt, it will show up with the other disclosures. This is the most important section to review while researching your broker. If there are no disclosures, then you’re good to go. If there are, however, then you should read through them carefully to decide whether to find another broker. Just because a customer dispute is filed does not mean that the broker engaged in wrongdoing. In many cases, the claim may not even reference the individual broker directly even if it shows up in the BrokerCheck report. Essentially, the existence of one or more disclosures does not automatically mean that the broker is bad. You should review and follow up on any disclosures you are concerned about. Do You Need a FINRA Attorney? If you’ve lost money and believe you are a...
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