You might think that a securities attorney is someone only investment bankers and hedge fund managers need when they get in hot water with the SEC or IRS, but securities attorneys represent a valuable asset to investors of any level. In fact, a securities attorney may be the only recourse you have if you find yourself the victim of some form of investment fraud. The following article discusses some of the unscrupulous and unethical practices brokers and managers often engage in, and which are also key practice areas for securities attorneys.
There are laws governing the manner in which investment managers and stockbrokers advise their clients concerning the purchase of stocks and other securities. In other words, the government, and the branches it has instituted to oversee the conduct of the investment community, understands that not all investments are appropriate for all investors.
Age, risk tolerance, income, and even your overall net worth are all factors that contribute to the suitable nature of an investment. Unfortunately, many stockbrokers and money managers are content to shove profitable investments down their clients' throats, regardless of whether or not the investment is sound. If you've been the victim of such unscrupulous conduct, a securities attorney may be just what you need to help you get back on the right financial track.
Failure To Diversify
Money managers and brokers are also under an obligation to ensure that your portfolio is as optimally diversified as possible. While there is no such thing as a perfectly diversified portfolio, some managers have blatant disregard for the concept, and their clients are ultimately the ones who pay the price for such carelessness.
If you believe that your losses could have been avoided in a better, more diversified portfolio, a securities attorney may be able to demonstrate a failure to diversify on the part of the broker or money manager and get you the compensation you deserve.
Those with more conservative investment goals are often the victims of what is known as churning. Churning involves a broker or money manager executing substantially more (or fewer) trades than what would otherwise be necessary to accomplish your investment objectives. This is done solely with the intent of earning higher commissions at your expense, and is strictly prohibited by the SEC.
There are many, many reasons you might need a securities attorney's assistance, but dealing with brokers or investment managers who recommended unsuitable investments, failed to diversify your holdings or engaged in some form of churning for their own profit, are three of the most important. Visit websites like www.carterwestlaw.com for more information.