9 de julio de 2021

La compraventa excesiva de valores para generar comisiones se denomina "churning": ¿le está ocurriendo a usted?

Muchas personas se preguntan a menudo: ¿es ilegal el churning? La respuesta es afirmativa. Las regulaciones de la SEC y las normas de FINRA prohíben la práctica de realizar compras o ventas excesivas de valores en cuentas de inversores con el propósito principal de generar comisiones, lo que se conoce como churning. A pesar de la ilegalidad del churning, FINRA presentó 190 acciones de arbitraje durante el año 2020 hasta finales de diciembre contra corredores acusados de esta práctica. Si sufrió pérdidas en su cuenta de inversión como resultado de una negociación excesiva, póngase en contacto con un abogado especializado en fraudes de churning para determinar si tiene derecho a recuperar una indemnización. ¿Qué es el churning en las finanzas? Churning, también conocido como trading excesivo, adquiere un nuevo significado en la industria financiera que no tiene nada que ver con la mantequilla. La negociación excesiva se produce cuando un corredor realiza múltiples operaciones en la cuenta de inversión de un cliente con el propósito principal de generar altas comisiones. El churning suele ocasionar pérdidas significativas a los inversores. El Reglamento de la SEC sobre el mejor interés, o Reg BI, establece una norma de conducta para los agentes de bolsa y sus empleados a la hora de recomendar inversiones a clientes minoristas. La Reg BI exige a los agentes que actúen en el mejor interés del cliente y no antepongan sus propios intereses a los del inversor. El "churning" casi nunca es lo mejor para el inversor, ni siquiera para aquellos con estrategias comerciales agresivas. Señales de que su asesor está manipulando su cuenta de inversión La manipulación de valores conlleva pérdidas sustanciales para el inversor, especialmente en situaciones en las que se prolonga durante mucho tiempo. Muchas veces, los inversores no reconocen los indicadores de que su asesor ha cometido el delito de negociación excesiva hasta que es demasiado tarde. Hay una serie de señales de precaución a las que debe estar atento cuando tema que su asesor financiero esté negociando excesivamente en su cuenta. Operaciones no autorizadas Las operaciones no autorizadas se producen cuando un agente negocia valores en su cuenta de inversión sin recibir autorización previa. Si tiene una cuenta de inversión discrecional, su asesor financiero tiene autorización para realizar operaciones en su cuenta sin pedirle su aprobación para cada transacción; sin embargo, su agente sigue estando obligado a cumplir la norma del interés superior. Las operaciones excesivas pueden ser más difíciles de detectar con una cuenta discrecional. La aparición de numerosas operaciones no autorizadas en el extracto de su cuenta es motivo de preocupación. Para reconocer estas operaciones, debe revisar mensualmente el extracto de su cuenta y verificar la información facilitada. Si observa operaciones no autorizadas en su extracto de cuenta, notifíquelo inmediatamente a su corredor y a su agente de bolsa. Volumen de operaciones inusualmente alto Un alto volumen de operaciones en un corto periodo de tiempo puede significar que se está produciendo un "churning", especialmente en el caso de inversores que siguen una estrategia de inversión conservadora. Preste especial atención a las transacciones que impliquen la compra y venta de los mismos valores una y otra vez. El abogado Robert Pearce tiene más de 45 años de experiencia representando a clientes cuya mala conducta por parte de corredores de bolsa les causó pérdidas financieras. La amplia experiencia del Sr. Pearce le permite reconocer los indicadores de churning inmediatamente y demostrar la cantidad de daños que sufrió como resultado de la mala conducta de su corredor. Comisiones excesivas Las comisiones inusualmente altas que aparecen en el extracto de su cuenta son otro indicio de negociación excesiva. Si las comisiones aumentan significativamente de un mes a otro, o si un segmento de su cartera de inversiones genera sistemáticamente comisiones más elevadas que cualquier otro segmento, existe la posibilidad de que su agente esté manipulando su cuenta. Los extractos de cuenta no suelen incluir los importes de las comisiones cobradas por cada transacción individual. Por lo tanto, no dude en ponerse en contacto con su agente de bolsa para pedir una explicación de las comisiones cargadas a su cuenta. Si usted siente que le están cobrando comisiones excesivas en sus cuentas de inversión, póngase en contacto con The Law Offices of Robert Wayne Pearce, P.A., para discutir sus opciones. Póngase en contacto con nuestra oficina hoy para una consulta gratuita Churning en la industria financiera puede resultar en sanciones monetarias e incluso la inhabilitación de la industria financiera en casos extremos. La práctica consiste en la manipulación y el engaño de los inversores que confían en sus corredores para actuar en su mejor interés, lo que justifica un castigo severo. Robert Wayne Pearce ha manejado docenas de casos churning y puede proporcionar una revisión completa de sus estados de cuenta para determinar si se produjo el comercio excesivo. Ademas, Las Oficinas Legales de Robert Wayne Pearce, P.A., emplea a expertos que pueden realizar un analisis de churning de la actividad comercial en su cuenta para establecer pruebas concretas de que la practica ocurrio. Tenemos la experiencia, los conocimientos y el compromiso para obtener los daños que se merece. Póngase en contacto con nuestra oficina hoy para una evaluación gratuita de su caso.

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10 de febrero de 2021

Qué hacer cuando su asesor financiero no actúa en su mejor interés

Is hiring a financial advisor in your best interest? In many cases, it may be when it comes to your investments. According to the SEC, approximately 6 in 10 households in the United States own securities investments. With more Americans investing, there is an increased need for financial advisors who can provide valuable insight into how best to invest and manage your accounts.  A financial advisor acting in your best interest is one of the best assets you can have when it comes to your investments. However, not all financial advisors live up to this standard.  Before you hire a fiduciary to represent your investment interests, it is important to first understand the duties your financial advisor owes you. By doing so, you will be better equipped to recognize when yours may not be acting in your best interest.  If you need help determining whether a financial advisor acting in your best interest and what you can do if they did not, we want to help. The Law Offices of Robert Wayne Pearce, P.A., has represented countless defrauded investors who have fallen victim to the actions of their advisors. Investment loss attorney Robert Wayne Pearce has over 45 years of experience handling a broad range of securities and investment disputes. Give us a call today to see what we can do for you. Fiduciary and Financial Advisor: Your Best Interest Is What Matters Most When you hire a financial advisor to provide you counsel regarding your investments, you expect that they will act in your best interest. The relationship between you and your advisor is a “fiduciary” relationship.  This fiduciary relationship requires a financial advisor to act in a certain manner when it comes to their clients’ investments. But what exactly is a “fiduciary duty,” and how do I know if my financial advisor owes me a duty to act in my best interest? We’ll dive into these questions in more detail below.  Fiduciary Duties: An Overview A fiduciary is someone who acts on behalf of someone else. In the investment context, a financial advisor who is hired to provide counsel and advice regarding their investments is a fiduciary. At its core, a fiduciary relationship relies on trust and good faith between the advisor and the client.  Being a fiduciary means that an investment advisor must act in their client’s best interest, putting their client’s needs over their own needs. In short, a fiduciary duty is a legal responsibility owed by the fiduciary (financial advisor) to act in the principal’s (client) best interest.  A fiduciary’s main duties are to: Put the client’s best interests first, ahead of their own; Avoid conflicts of interest or disclose them to the client as soon as they arise; and Act with honesty, good-faith, and loyalty toward the client.  Failure by a financial advisor to act in your best interest may constitute a breach of their fiduciary duty. This can result in serious liability for the advisor. Is Everyone a Fiduciary?  No, not everyone will be considered a fiduciary.  A fiduciary relationship is a special relationship that arises only in specific circumstances. The Investment Advisers Act of 1940 requires only registered investment advisors to abide by fiduciary obligations to act in a client’s best interests. Thus, all investment advisors who are registered with the SEC or a state securities regulator are fiduciaries. Broker-dealers and stockbrokers, on the other hand, are not fiduciaries. The New “Best Interest” Rule: A Replacement for the Suitability Standard Until recently, there was a lower standard of care that applied to most brokers and agents. This was governed by FINRA Rule 2111, otherwise referred to as the “suitability” standard.  Unlike a fiduciary standard of care, suitability required only that a broker-dealer make investment decisions that were “suitable” for his or her client based on the client’s investment objectives. They did not have to put their client’s interests ahead of their own. Further, they were free to recommend products that might benefit themselves, so long as the product was suitable for the client. This changed on June 30, 2020, when the SEC enacted Regulation BI—the Best Interest Rule. Now, regular stockbrokers also have a duty to act in the best interests of their retail clients when making recommendations about their investments. Specifically, Regulation BI imposes four obligations upon broker-dealers and associated persons:  Provide disclosures to customers regarding the relationship at the time of or before making any recommendations;  Exercise due care, or reasonable diligence, care, and skill, in making recommendations to customers;  Establish, maintain, and enforce procedures and policies to address potential conflicts of interest; and  Establish, maintain, and enforce procedures and policies to achieve compliance with Regulation BI.  If you feel your financial advisor or broker has failed to act in your best interest and live up to their obligations, seek help promptly from an experienced attorney. How Do I Know If Someone Is a Fiduciary? The easiest way to know for sure if a financial advisor is a fiduciary is to ask them. You can also check on the SEC Investment Advisor Database for federally registered investment advisor firms. Another way is to ask about an advisor or advisor firm’s pay structure. If an advisor is paid based on commission, he or she is most likely not a fiduciary. Fiduciaries usually work on fees only, so an advisor who advertises that they work on commission may not be acting as a fiduciary. But again, remember that even if your advisor is not a federally registered investment adviser held to a fiduciary standard, they still owe you certain obligations. All stockbrokers now have a duty to act in the best interests of their retail investors when making recommendations regarding their investments. Breach of Fiduciary Duty and What to Do If Your Financial Advisor Doesn’t Act in Your Best Interest A fiduciary breaches his or her duty by acting in their own interest rather than in their client’s interest. Additionally, failure to act in your best interest may give rise to a...

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14 de enero de 2021

Los corredores y agentes de bolsa tienen el deber de proteger a las personas mayores de la explotación financiera

Protecting seniors from financial exploitation requires a collaborative effort between the government and financial experts. In general, securities brokerage firms and their stockbroker employees have a fiduciary duty to their customers. FINRA rules also establish a broker-dealer and stockbroker’s responsibility to protect seniors from financial exploitation by others. Unfortunately, the financial exploitation of seniors is a growing problem. If you or a family member believes you were taken advantage of by your stockbroker, investment advisor or another financial professional then you need to speak with a skilled investment fraud attorney right away. Based in Boca Raton, the legal team at the Law Offices of Robert Wayne Pearce, P.A., has years of experience representing clients for various types of investment, securities, and commodities fraud. We have handled hundreds of JAMS, FINRA, and AAA securities mediations and arbitrations for clients across the country and even some international clients. Financial Exploitation Is Elder Abuse According to the National Adult Protective Services Association, financial exploitation is a type of elder abuse on the rise. It covers the abuse of seniors and adults who have disabilities. This type of abuse usually involves trusted people in a person’s life, such as stockbrokers, investment advisors, other financial professionals, trustees, guardians, caretakers, neighbors, family members, and friends. This abuse happens because many seniors simply cannot protect themselves any longer. They are more trusting and relying on others. They are incapable of detecting fraudulent schemes. It is difficult for them to understand the nature, mechanics or risks of investments being offered and sold to them. Many cannot even read or comprehend the account statements or confirmations sent to them. So they allow others to manage their financial affairs and some of those people they trust and rely upon financially exploit them. There are numerous types of investment fraud perpetrated upon seniors. Some of the most common abuses and scams by stockbrokers, investment advisors and other financial professionals include: Getting seniors to allow fraudsters access to and/or management of their bank and/or brokerage accounts; Telling seniors to write personal checks to stockbrokers, investment advisors and other financial professionals to supposedly make investments not available through the brokerage firm; Taking money from seniors in exchange for worthless promissory notes or notes the fraudster has no intention of ever re-paying to the senior; The offer and sale of unsuitable complex structured products, alternative and non-conventional investments for the high commissions paid on those investments; Advising seniors to take out reverse mortgages or equity lines and use the proceeds to trade securities; Other scams that pressure a senior to use the equity from their reverse mortgage or equity line (or other liquid assets) to purchase an expensive variable universal life insurance policy, variable annuity, or indexed annuity with high commissions, high surrender fees, expensive riders and  that may not even mature until the senior is around 90 or 100 years old; Investments or securities schemes, such as Ponzi or pyramid schemes, promising unrealistic returns; Investments involving an unlicensed dealer. Victims of financial exploitation can experience all the same effects as someone who has endured another type of abuse, including depression, loss of trust, and feelings of shame. Financial Industry Regulatory Authority (FINRA) Recent rule changes to the Financial Industry Regulatory Authority (FINRA) went into effect in February 2018. These significant rule changes help establish additional protections for senior citizens. The two notable changes are FINRA Rules 2165 and 4512. FINRA Rule 2165 The SEC adopted new FINRA Rule 2165, which is the Financial Exploitation of “Specified Adults.” This rule will permit members to place a temporary hold on securities or disbursements of funds from an account when there is suspected financial exploitation. If a financial broker reasonably suspects that there is financial exploitation, then they can withhold disbursement. However, the rule does not create an obligation to stop the disbursement. Instead, it provides the right for brokers to do so. Stockbrokers should be proactive and look for potential abuse, so they can stop it early on, helping protect unsuspecting senior investors from becoming victims. Rule 2165 defines specified adults as particular investors who are most at risk for financial exploitation. That includes the following people: Someone who is 65 years of age or older; and Someone who is 18 and older that the broker has reason to believe has a physical or mental impairment that renders the investor unable to protect their own interests adequately. Brokers also have to know what the rule defines as financial exploitation. One example is the unauthorized or wrongful withholding, taking, use, or appropriation of a specified adult’s securities or funds. Financial exploitation can also be any act or omission made through someone’s guardianship, power of attorney, or any other authority with the purpose of: Converting the specified adult’s assets, money, or property; or Obtaining control of the specified adult’s property, money, or assets through the use of intimidation, deception, or undue influence. Rule 2165 allows a broker to put a temporary hold on suspicious disbursements but not on ones that do not appear to be related to the financial exploitation of seniors. The rule does not apply to transactions in securities, such as a customer’s order to sell their share of stocks. But it could apply to a request by the investor to disburse shares out of their account. FINRA Rule 4512 The SEC also adopted FINRA Rule 4152, which concerns customer account information. Under this amended rule, members must make reasonable efforts to obtain a name and contact information for an investor’s trusted contact person on their account. Investors should have a trusted contact listed whom the stockbroker can reach out to and disclose pertinent information about an account. They can also disclose health status and even ask about the client’s whereabouts if the broker cannot reach them directly. Stockbrokers can get a trusted contact name when opening the account or when updating information for accounts established before the effective date of Rule 4512. The amendment requires the broker to disclose in writing or electronic documentation...

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22 dic 2020

¿Qué es el fraude en los fondos de cobertura?

Hedge funds are an increasingly popular investment tool, often suggested as an alternative to other pooled fund investments. However, because the Securities and Exchange Commission (SEC) provides less regulation over them, hedge funds carry a greater risk. Over the past two decades, investors have lost billions of dollars to fraud involving hedge funds. As an investor, it is important to be aware how hedge funds operate and how they can be fraudulent. If you believe you’ve been the victim of investment fraud, contact an investment fraud attorney right away. They can assess your case and advise you on your potential options for recovery. What Is a Hedge Fund? Simply put, hedge funds are a type of investment partnership. Like a mutual fund, a hedge fund is built from the pooled funds of many different investors. These investors give their money to fund managers, who invest it according to the fund’s overall objectives. Hedge funds are an attractive option to many investors because they are more aggressively managed than other investment vehicles. Hedge funds invest in a variety of non-traditional assets beyond stocks and bonds, including foreign currencies, real estate markets, and even derivatives. This kind of investment strategy does have its benefits. At the same time, however, the enormous complexity of hedge funds makes them a higher risk. Investors may not know exactly how their money is tied up at any given time. What Is Hedge Fund Fraud? There is no single way that hedge fund managers defraud investors. Instead, hedge fund fraud can take the form of several common types of investment scam, including: Embezzlement; Insider trading for the personal benefit of the hedge fund managers; Securing an investment through misrepresentations about about the investments within the fund or its promised returns; Securing your investment without properly disclosing the risks of the fund; and Hiding investment losses. Occasionally, a hedge fund covers up an outright investment scam from the beginning. Bernie Madoff’s infamous Ponzi scheme, for example, involved a hedge fund. Many hedge funds are legitimate, but investors must always be wary of who is managing their money. What Are the Signs of Hedge Fund Fraud? As with other types of investment fraud, hedge fund fraud can take a number of forms. In general, however, if the promises made about a hedge fund seem too good to be true, they probably are. No two hedge fund fraud cases are exactly alike, but there are several red flags you can look for. When researching a potential investment, pay attention to Promises of excessive returns; Promises of consistent returns regardless of market strength; Vague or complicated communication about your investment; Whether an independent accounting firm regularly audits the fund; and Whether the fund has a balance of liquid and illiquid investments. In addition, the conduct of a hedge fund manager is a good way to judge the legitimacy of a hedge fund. Unlike brokers at a brokerage firm, hedge fund managers do not receive commissions for the securities they sell. Instead, reputable hedge funds charge a management fee of between 1% and 4% of the total assets managed and a performance fee based on the total profit the fund generates. If you plan to invest in a hedge fund and the manager indicates that they are paid on commission, it’s probably best to stay away. Why Is Hedge Fund Fraud So Common? Hedge funds have two primary characteristics that make them a prime target for investment fraud. First, compared to other investments, hedge funds are relatively unregulated. And second, hedge funds involve larger investments and wealthier investors. Hedge Funds Operate with Less Oversight from the SEC Hedge fund fraud is more common because hedge funds operate with less oversight from the SEC. The SEC requires certain types of investment companies to register with the Commission before commencing operations. As a condition of registration, these companies must file certain reports with the SEC. This additional oversight makes it harder for these regulated investment funds to engage in fraudulent behavior. Hedge funds organize themselves as private investment limited partnerships so that they fall within an exception to these registration requirements. This exception allows hedge funds to operate without registering with the SEC and exempts them from the same mandatory reporting requirements as registered investment companies. Hedge Funds Involve More Money Compared to Other Funds Hedge funds are a common target for investment fraud because they involve investors with a higher net worth than in other pooled funds. Compared to other types of investments, hedge funds require sizable upfront investments to join. What’s more, the SEC permits only accredited investors to trade in unregistered securities. The SEC considers an investor to be “accredited” if they have an individual income in excess of $200,000 per year or a net worth of more than $1 million. In August 2020, the SEC amended the definition of “accredited investor” to include investors that meet certain minimum thresholds of professional knowledge, experience, or certifications. In a sense, accredited investors are those that the government believes are sophisticated enough to make riskier investment decisions on their own. However, even diligent and knowledgeable investors may fall victim to particularly clever investment fraud schemes. Unscrupulous hedge fund managers know this and may see these wealthy investors as an opportunity for fraud. Should I Hire an Investment Fraud Attorney? If you’ve suffered investment losses after investing in a hedge fund, it is important to speak with an investment fraud attorney right away. As an investor, there are a number of legal theories on which you can rely to hold a hedge fund and its managers liable for your losses. For example, even though hedge funds are not required to register with the SEC, hedge fund managers are still investment advisers obligated to act as fiduciaries to their investors. As fiduciaries, hedge fund managers owe both a duty of loyalty and a duty of care to their investors Thus, in addition to claims for misrepresentation, breach of contract, or other theories of liability, hedge...

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22 dic 2020

Cómo recuperar sus inversiones de un esquema Ponzi

If you are an investor who has suffered investment losses as a result of a Ponzi scheme, you’re not alone. In fact, Ponzi schemes are reaching levels that haven’t been seen in a decade, putting many investors in a difficult position. Losing your hard-earned money to a Ponzi scheme can be devastating. And frequently, it can also be surprising. This is because many investors often don’t realize they’ve fallen victim to a Ponzi scheme until it’s too late.  While this can be difficult to process, know that it’s not the end of the road. There are ways that you can fight to recover your investments.  If you need help figuring out how to recover from a Ponzi scheme, the Law Offices of Robert Wayne Pearce, P.A., is ready to help. Investment loss attorney Robert Pearce specializes in getting individuals their money back from bad investments. He has been helping his clients recover for over 45 years and will fight to do the same for you.  Ponzi Schemes: An Overview According to one source, there were an estimated 60 Ponzi schemes uncovered in 2019. In total, these schemes resulted in $3.245 billion in losses to investor funds.  But what exactly is a Ponzi scheme?  Knowing the answer to this question can help you identify whether you may have fallen victim to a Ponzi scheme. If you have, contact our team today to find out how we can help you recover.   Where Does the Name “Ponzi” Scheme Come From? In the 1920s, a man named Charles Ponzi promised investors they would receive a 50% return within 45 days by purchasing discounted reply coupons in other countries and redeeming them at face value in the United States as a form of arbitrage. Ponzi, in reality, was using the funds of later investors to pay the earlier investors to fund his scheme.  Ponzi operated this scheme for over a year, resulting in over $20,000 in losses to investors. What Is a Ponzi Scheme?  A Ponzi scheme is a form of financial fraud. Typically, a ponzi scheme operates by inducing investments from unsuspecting investors often by promising high, risk-free returns over a short period of time from a purportedly legitimate business venture.  In a Ponzi scheme, money funded by new investors is used to pay returns to older investors, rather than money actually made by the purported business. Essentially, the scheme relies on the constant flow of new investor money to survive.  Key Elements of a Ponzi Scheme A Ponzi scheme is a specific type of investment fraud that has a few distinct characteristics. The key elements of a Ponzi scheme involve: Using new investor funds to pay earlier investors; Representing that the returns are generated from a purported business venture; and Attempting to hide the lack of economic success of the purported venture or defer the realization of loss. If these elements exist in your scenario, there is a chance you may be the victim of a Ponzi scheme. An investment loss attorney can help you determine whether this may be the case and what you can do to recover.  Warning Signs of a Ponzi Scheme Knowing the definition of a Ponzi scheme is one thing. But being able to identify one is another thing entirely.  In fact, identifying a Ponzi scheme is more difficult than you might think. However, knowing the warning signs of a potential Ponzi scheme is the first step to avoid potentially being involved in one.  The Securities Exchange Commission (SEC) and the Financial Industry Regulatory Authority (FINRA) have published a list of characteristics that are common to most Ponzi-like schemes. When attempting to identify a potential Ponzi scheme, look for these red flags. Promises of High Returns with Little to No Risk All investments inevitably carry some risk. Thus, any promise of a “guaranteed” high-return investment should be treated with skepticism. Typically, investments that yield high returns are riskier than investments that yield low returns. If the promise of returns seems “too good to be true,” it probably is. Overly Consistent Returns It is well-known that the market can be very volatile. Thus, investments usually go up and down over time, rather than remaining constant or going up consistently without any fluctuation.  If you are receiving all positive returns, even during times of market volatility, this could be a red flag. Seek more detailed information about your investments, and if something seems off, contact an attorney to discuss your options.  Unregistered Investments You should always be weary of investments that are unregistered.  Registration provides investors with access to important information about the company offering the investment. If a broker is selling or recommending investments that are unregistered, this may be a sign of a potential Ponzi scheme.  Unlicensed Sellers Always be suspicious of sellers who claim they are exempt from licensing.  In fact, federal and state laws require sellers to be licensed or registered. Many Ponzi schemes involve unregistered sellers or unregistered broker-dealers. Difficulty Receiving Payments As an investor, you should have the ability to cash out your investments when you choose to do so.  If you are unable to cash out your investments easily or if you have received multiple offers to “roll over” your promised payments for an even higher return, this could be a red flag.  I May Have Invested in a Ponzi Scheme—Now What Can I Do? If you believe you might be the victim of a Ponzi scheme, you might feel tempted to give up. But don’t do so quite yet.  Parties that defraud investors through a Ponzi scheme can be held liable for the losses caused by their actions. This includes brokers, financial advisors, and brokerage firms.  Additionally, if a broker-dealer is registered with FINRA, you may be able to file a FINRA arbitration against the broker who defrauded you and caused you to lose money.  So what’s next? Here’s what you need to know about how to recover from a Ponzi scheme.  Gather All Relevant Information If you suspect that you are...

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