Avoiding Legal Trouble

Securities Law — The Legal Process For An Investor

Misconduct or fraud that is the fault of a brokerage or investment firm could result in monetary losses that are debilitating. If you believe that your investments have been handled poorly, consult with a securities law attorney.

The Regulations

Brokerages and investment firms are required to register their businesses with the SEC (Securities and Exchange Commission). The SEC has the capacity to monitor a brokerage or investment firm's management practices. Investment firms must follow a code of conduct at the Federal and state levels. Any wrongdoing that is discovered could result in legal penalties.

The Claim

In order for a legal claim to be valid, it must meet the criteria set forth by the SEC and governing forces. There are many situations that warrant filing a claim against a brokerage or investment firm. Misrepresenting a client, failing to monitor investments, swaying an investor to make an investment that is risky, and stealing funds from an investment account are some situations that may require legal assistance.

A lawyer's objective is to prove that their client is a victim of wrongdoing. They will attempt to recoup financial losses that were a direct result of the mishandling of funds or the deceptive practices that a broker or investment agent executed.

The Consultation

Before you file a lawsuit against the brokerage or investment firm that handles your investments, obtain a copy of your investment portfolio. The portfolio will provide insight into your investments. This information is vital to your case. It will demonstrate how long you have been a client, plus the types of investments that you have made.

Your legal representative will schedule a time to look over the material. They will discuss the portfolio with you during a standard meeting. You will also need to verbalize what type of wrongdoing that you believe you are a victim of.

Substantiating The Claim

If the securities lawyer is confident that they can help you recover your financial losses, they will prepare the preliminary paperwork that will be filed against the defendant. Then, your lawyer will begin to build your case.

Proving the wrongdoing of the defendant can be complicated. The attorney will research the history of the company that you have invested funds with. They will also determine if the company breached any of the legal responsibilities that were outlined in the contract that you signed. All of the groundwork that your lawyer conducts will be presented during a legal hearing. 

For more info, contact a local securities law attorney