Investment Losses

People work hard for their money. Oftentimes, people invest their hard-earned money in the stock market and other investment vehicles with the assistance of a financial advisor or stockbroker. Relying on these professionals makes sense given the complex nature of investment opportunities in today’s world. The stakes are high, ranging anywhere from investing in a child’s college fund to saving for retirement. Unfortunately, some dishonest and unscrupulous advisors and brokers place their own interests above those of their clients, choosing to line their own pockets at the expense of their clients’ hard-earned money.

Financial advisors and stockbrokers can fail to live up to their professional duties in a variety of ways. Whether they do so intentionally or through negligence, the results are the same—an unnecessary loss of client funds. Some of the most common types of misconduct include:

Making misrepresentations and omissions regarding the risk of a particular investment
Failure to diversify, which is the overconcentration of an investor’s portfolio in a single industry or security
Churning, which is a fraudulent way to generate excessive commissions
Failure to perform due diligence prior to recommending an investment
The sale of securities or other investments that are not suitable for a client’s risk tolerance
Failure of managers to appropriately supervise the work of their advisors and brokers
The sale of fake securities or product