Security and Investment Fraud

How Security and Investment Fraud Lawsuits Work and How a Wellsburg Criminal Lawyer Can Assist You

When you place your hard-earned money with a financial institution, you have every right to expect both security and growth. Complete transparency remains essential, as you deserve full knowledge about your investments and their potential. Unfortunately, dishonest stockbrokers and investment advisors sometimes exploit this trust, leading to devastating financial consequences. Multiple factors can contribute to such losses, including inappropriate financial guidance, conflicts of interest, and deliberate fraud.

When confronted with situations where you or family members have become victims of investment and security fraud, securing assistance from an experienced Wellsburg criminal lawyer becomes crucial.

At Logue Law Group, we possess extensive experience and knowledge in managing cases involving investment and banking fraud. Our committed team of Wellsburg DUI attorneys will work relentlessly to help you recover lost funds.

Various Forms of Security and Investment Fraud

Investment fraud includes multiple types of broker misconduct, each capable of depleting your savings and retirement funds. Below are several examples:

Bond Frauds

Bonds represent debt instruments utilized by corporations and governments to raise capital from investors. While financial advisors and brokers frequently present these investments as secure options for fixed-income investors, fraudulent schemes can eliminate your entire portfolio. Even during economic downturns, countless individuals became victims of these scams, leaving them financially ruined.

Breach of Fiduciary Duty

A broker functions as the essential connection between buyers and sellers, trusted with negotiating contracts while maintaining no personal interests. Consider real estate brokers, commodity brokers, security brokers, insurance brokers, and mortgage brokers, all bound by legal obligations to guide parties toward informed decisions. However, when brokers neglect their fiduciary responsibilities, they enter fraudulent territory. If you’ve experienced such practices, our Wellsburg DUI attorney can help you recover your losses.

Churning and Excessive Trading

Imagine your broker continuously encouraging excessive trading in the stock market, endangering your security account and undermining your financial stability. This behavior represents a fraudulent maneuver that requires immediate action.

Failure to Supervise: Safeguarding Your Investments

Any reputable investment group or organization must establish and maintain strict rules and regulations for supervising their registered financial advisors and brokers. These brokers carry the responsibility of regularly reviewing your portfolio, ensuring your trades align with your investment objectives and risk tolerance levels. When your broker’s negligence results in financial losses, it clearly constitutes fraud. A qualified Wellsburg criminal lawyer can evaluate your case and determine appropriate legal action.

Investment Fraud and Misconduct

Regarding your hard-earned money, you should trust your brokers completely. Sadly, some brokers prioritize their personal interests, abandoning their clients. This fraudulent behavior causes investors to lose money in various schemes, including:

• Non-traded real estate investment trusts: These lack liquidity and can tie up your funds for extended periods.
• High-risk junk bonds: These investments carry significant default risks, putting your money in jeopardy.
• Ponzi schemes: Promising high returns, these fraudulent operations depend on new investors’ money to pay existing ones, creating unsustainable cycles.
• Structured notes: These hybrid security products may appear attractive but often involve complex terms and hidden risks.
• Unsuitable variable annuities: Elderly investors or retirees may face pressure to purchase these products, which may not align with their financial goals.

Margin Trading

A fraudulent financial advisor might recommend purchasing stocks using borrowed money, known as margin trading. This high-risk strategy can generate substantial commissions for brokers, even without additional upfront investments from customers. Unscrupulous advisors may fail to highlight involved risks, potentially causing significant financial harm. When facing such situations, consulting with a Wellsburg DUI attorney becomes essential.

Omissions or Misrepresentation by the Broker

Financial brokers have fiduciary duties to explain every investment aspect, including terms, clauses, and potential risks. Failing to disclose these crucial details can constitute fraud if investors lose money due to broker negligence.

Overconcentration of Assets

Diversification remains key to mitigating risk and maximizing returns. Responsible brokers consider factors like age, risk tolerance, and financial status when making informed investment decisions for clients. However, when brokers disregard these factors and concentrate assets in limited investments, it could constitute fraudulent activity. A skilled Wellsburg criminal lawyer can help determine if overconcentration has occurred.

Preferred Securities

During market crises, preferred securities may behave more like common stocks and fail to provide anticipated income. Unlike common stocks, these securities often miss upward price appreciation while remaining exposed to potential declines. Ultimately, they may fail to generate expected value.

REIT Issues

A Real Estate Investment Trust (REIT) represents a company that ties its assets and investments to real estate projects, distributing 90% of returns as dividends to shareholders annually. Investing in REITs provides access to property portfolios that individual investors may not typically consider. However, when broker negligence results in failure to deliver promised returns, consulting a Wellsburg DUI attorney may become necessary to file claims for monetary recovery.

Selling Away

When brokers sell or solicit sales of unapproved private securities, it constitutes fraud. Both organizations and investors can hold brokers accountable for these actions.

Unauthorized Trading

One common investment fraud form involves unauthorized trading, where brokers use non-discretionary investment accounts without proper investor permission. This fraudulent activity may also involve churning, a practice designed to generate higher commissions for brokers at investor expense. Victims of such practices should contact a Wellsburg criminal lawyer immediately.

Variable Annuity Issues

While investment advisors often present variable annuities as sound retirement plans, they pose significant risks for elderly investors. These risks arise from high annual costs exceeding 3% and substantial penalties imposed when investors liquidate annuities prematurely.

Seek Assistance From a Wellsburg Security and Investment Fraud Lawyer

At Logue Law Group, our experienced Wellsburg DUI attorney team understands the importance of handling investment fraud cases with utmost expertise and diligence, ensuring financial loss recovery. Contact us 844.PITT.DUI today for a complimentary consultation.