Texas Investment Fraud Lawyer

The Law Offices of Robert Wayne Pearce, P.A. represent investors throughout Texas who have been harmed by dishonest brokers, financial advisors, and brokerage firms. Our attorney, Robert Pearce, has spent decades fighting for victims of investment fraud, and we’ve recovered over $185 million in recoverable damages for our clients.

Whether you’re dealing with unauthorized trades, Ponzi schemes, churning, or any other form of broker misconduct, we have the experience and resources to pursue the recovery you deserve. Our law firm represents investors in securities law disputes across the state, from stockbroker fraud claims to complex FINRA arbitration cases.

If you believe your broker or financial advisor committed fraud, call us today at (800) 732-2889 for a free consultation.

What is investment fraud?

Investment fraud happens when a broker, financial advisor, or other financial professional misleads you about the risks, returns, or nature of an investment in order to profit at your expense. Under the Texas Securities Act, these deceptive practices can include outright misrepresentation, the deliberate omission of important facts, or any form of manipulation designed to get you to buy, sell, or hold a security based on false information.

The targets of investment fraud span a wide range of financial products, from stocks and bonds to mutual funds, real estate investments, hedge funds, and private placements. Promissory notes and unregistered securities are also common vehicles for financial fraud, particularly when sold by individuals or firms operating outside proper regulatory channels.

In many cases, victims don’t realize they’ve been defrauded until they notice significant and unexplained losses in their accounts. Texas law treats securities fraud as a felony, and depending on the amount of money involved, penalties can range from a third degree felony to a first degree felony with substantial prison time and fines.

The securities industry is heavily regulated at both the state and federal level, yet fraud continues to affect individual investors across Texas every year.

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What are the signs of investment fraud in Texas?

If your account shows unexplained losses or trades you never approved, there is a real chance that fraud may be involved. One of the most common warning signs is receiving account statements that don’t match what your financial advisor told you verbally about your portfolio’s performance or the investments being made on your behalf.

You might also notice that your advisor has become difficult to reach, avoiding your calls or delaying the delivery of account documents when you request them. Sudden and significant drops in your portfolio value that don’t line up with broader market conditions should also raise concerns, especially if your broker has not provided any explanation for the financial loss.

Many victims of investment fraud describe a slow realization that something was wrong, often after months or even years of trusting their advisor without question. Other warning signs include investments that were never discussed with you, account activity that doesn’t match your investment objectives or risk tolerance, and pressure from your broker to move your retirement savings or net worth into unfamiliar products.

If any of these situations sound familiar, you owe it to yourself to have your account reviewed by someone who can identify whether misconduct occurred.

Types of investment fraud cases we handle

We handle a wide range of investment fraud cases across Texas, including churning, Ponzi schemes, unauthorized trades, and broker misconduct. Our securities fraud attorneys represent investors in Dallas, Houston, Austin, and throughout the Lone star state, and each type of fraud requires a different legal strategy and body of evidence to prove.

Below are some of the most common types of cases our investment fraud lawyers pursue on behalf of our clients.

Ponzi schemes and pyramid schemes

Many of our clients who lost money to Ponzi schemes were retirees who invested their life savings based on promises of guaranteed returns, only to discover too late that every dollar they received came from other investors rather than any real profit. A Ponzi scheme is a type of securities fraud where returns paid to existing investors are funded entirely by money contributed by new investors, and the scheme survives only as long as new money keeps flowing in.

When recruitment slows or stops, the entire structure collapses and investors lose everything. Pyramid schemes operate in a similar way, relying on a constantly expanding base of participants to fund payouts to those at the top.

These schemes are often run by individuals who use fake account statements and fabricated performance reports to keep investors from asking questions. Victims of these schemes can often pursue recovery through FINRA arbitration claims, and in some cases, federal court actions may also be available depending on the scope of the fraud.

Churning and excessive trading

You trust your broker to make trades that serve your financial goals, but churning is what happens when a broker trades your account excessively to generate commissions for themselves instead. Your brokerage firm has an obligation to supervise its individual brokers and prevent this kind of abuse, and when it fails to do so, both the broker and the firm can be held liable for your losses.

Financial professionals use metrics like turnover ratios and cost-to-equity ratios to measure whether trading activity in an account was excessive relative to the account’s size and goals. Many of our clients come to us feeling devastated after watching their accounts shrink month after month while their broker continued to profit from every transaction.

We understand how painful it is to realize that someone you trusted was putting their own interests ahead of yours, and we are prepared to fight to recover what was taken from you. FINRA rules require broker dealers to act in your best interest, and when they don’t, you have every right to pursue a claim.

Unauthorized trading and unsuitable investments

Unauthorized trading occurs when a broker buys or sells securities in your account without your permission or knowledge, and it is a direct violation of the fiduciary duty your broker owes you. Brokers are required to get your consent before executing any transaction on your behalf, and when they skip that step, you have grounds to take action.

This type of misconduct is especially common in non-discretionary accounts where the broker has no authority to act independently. Unsuitable investments are a related problem where a broker recommends products that don’t align with your risk tolerance or investment objectives.

Variable annuities, private placements, and other investments with high fees or long lock-up periods are frequently sold to investors who have no business owning them, often because the broker earns a higher commission on those products. Unsuitable investment recommendations can devastate a portfolio, particularly when they involve an investor’s retirement savings or a significant portion of their net worth.

If either of these violations has affected your portfolio, an experienced fraud attorney can review your account and determine how much you may be owed.

Broker misconduct and breach of fiduciary duty

Your broker is legally required to put your interests ahead of their own, and when they fail to meet that standard, it is considered a breach of fiduciary duty. Broker misconduct takes many forms, including misrepresentation of investment risks, omitting important facts about a product, and placing personal financial gain above your wellbeing through conflicts of interest.

Financial advisor misconduct also extends to situations where an investment adviser fails to disclose material information about the risks associated with a particular security or strategy. Securities arbitration gives investors a way to hold these financial professionals accountable when their actions cause real financial harm.

The licensed attorneys at The Law Offices of Robert Wayne Pearce, P.A. have recovered over $185 million for investors harmed by this kind of wrongdoing, and we have the extensive experience needed to fight for you too. Contact Bob Pearce today for a free case evaluation.

How can a Texas investment fraud lawyer help you?

An investment fraud lawyer investigates your account activity, gathers the evidence needed to prove misconduct, and files claims on your behalf to recover your investment losses. This process often begins with a detailed review of your account statements, trade confirmations, and communications with your broker or advisor to identify patterns of fraud or negligence.

From there, your attorney handles every step of the FINRA arbitration process, including drafting and filing your statement of claim, conducting depositions, negotiating settlements, and presenting your case before an arbitration panel if necessary. Our fraud lawyers also work with financial experts who can analyze your portfolio and calculate the full extent of your losses, including lost opportunity costs and interest.

Many of our clients are retired couples or older investors who trusted their advisor for years, only to discover that their retirement savings were lost to negligence or outright fraud. We understand how painful that experience is, and we will fight relentlessly to recover what was taken from you.

Your attorney can also file formal complaints with the Securities and Exchange Commission and state regulators to hold wrongdoers accountable and protect investors from further harm. We represent investors on a contingency basis, which means you pay nothing unless we recover compensation for you.

How does FINRA arbitration work in Texas?

FINRA arbitration is a faster and less expensive alternative to going to court for resolving financial disputes between investors and their brokers or brokerage firms. The Financial Industry Regulatory Authority oversees the largest securities dispute resolution forum in the country, and most brokerage agreements include a predispute arbitration clause that requires investors to use this process instead of filing a traditional lawsuit.

In Texas, FINRA arbitration hearings are held in Dallas and Houston before a panel of independent arbitrators who review the evidence and issue a binding decision. The process typically takes 12 to 18 months from the initial filing to the final award, though more complex cases can take longer.

It begins when your attorney files a statement of claim outlining the dispute, the parties involved, and the damages you’re seeking. Both sides then go through a discovery phase where documents and evidence are exchanged before the case proceeds to a hearing where each party presents their arguments.

Our FINRA attorneys have handled hundreds of arbitration cases and understand exactly what it takes to build a winning claim. Unlike court proceedings, FINRA arbitration decisions are final and binding, with very limited grounds for appeal, which is why having a skilled legal team on your side from the very beginning is so important to the outcome of your case.

What is the statute of limitations for securities fraud in Texas?

Texas gives you five years to pursue criminal securities fraud charges under the Texas Securities Act, while civil fraud and breach of fiduciary duty claims are subject to a four-year statute of limitations. If you are filing through FINRA arbitration, you generally have six years from the date of the event that gave rise to your claim.

The Texas State Securities Board is the state agency responsible for overseeing securities transactions and enforcing state securities laws, and it can refer suspected criminal violations to prosecutors for action. One important exception to these deadlines is the discovery rule, which may delay the start of the limitations clock if the fraud was hidden from you and you had no reasonable way to know about it at the time.

This exception exists because investment fraud is often designed to go undetected, with criminals using fake statements and misleading reports to keep investors in the dark for as long as possible. Regardless of which deadline applies to your situation, acting quickly protects your ability to recover your full losses and strengthens your case by preserving evidence while it is still available.

If you have lost money and suspect fraud, do not wait to speak with an investment fraud attorney about your options.

Investor Locations Served in Texas

Contact the Law Offices of Robert Wayne Pearce, P.A. to learn more about investment fraud in Texas

If you suspect that your broker, financial advisor, or brokerage firm has committed investment fraud, you don’t have to face this alone. The attorneys at the Law Offices of Robert Wayne Pearce, P.A. are ready to review your case, answer your questions, and help you understand your options for pursuing a recovery.

We offer a free consultation to every potential client, and we work on a contingency basis so you never pay a fee unless we win. Call us today at (800) 732-2889 or send us a secure message online to speak with attorney Bob Pearce. Let us put our experience to work for you.