Just because you’ve entered into a contract with a brokerage firm or stockbroker doesn’t mean your contract won’t be violated. Whenever the actions of your broker or financial firm infringe upon your agreement (whether it be written, verbal or implied), a breach of contract or breach of promise has occurred.
If your broker failed to keep the promises he made, and you suffered the financial consequences, compensation may be available by filing a FINRA (Financial Industry Regulatory Authority) arbitration claim.
How Breach of Contract Happens
When you open a full-service relationship with a Wall Street brokerage firm, you’re doing so because you want the expert services of a professional investment team to recommend sound strategies and watch over your savings in earnest. You also understand these experts will be acting in your best interests rather than their own, i.e., they’re not just recommending an investment because it’s going to pay them a big commission.
By virtue of you entering into this relationship with a brokerage firm, you’ve entered into a contract to receive this level of service, fully expecting that the services and terms outlined in your written, verbal and implied contracts will be rendered and adhered to.
No one expects their stockbroker to be a fortune teller, and everyone understands that certain pitfalls and risks exist with investing. However, brokerage firms must, at the very least, uphold their end of the bargain as outlined in your contract and as your financial advisor.
Your contract (written, verbal or implied) may be that you want your account managed in a highly conservative fashion, or according to specific requirements. Your contract may give your stockbroker the authority to buy and sell securities without consulting you first. Or you may have given your broker specific verbal instructions on how to handle your account.
When paying another individual for specific services, a contract or a “promise” is formed:
- Verbally, through a telephone conversation, meeting or another kind of discussion.
- In writing, by way of a written contract.
- By way of your broker’s actions (an implied contract). If an individual presents himself as an investment advisor providing specific kinds of services, the law requires that certain standards of behavior and fair dealing be adhered to.
A breach of contract or breach of promise can take many forms and a qualified and experienced stock fraud arbitration attorney required to determine if you have a claim in this regard. If you suspect that you are the victim of a breach of contract or breach of promise, contact an attorney now before it’s too late.
Know Your Rights
The SEC (Securities and Exchange Commission) has given FINRA (The Financial Industry Regulatory Authority) the power to protect investors, and FINRA takes this role seriously, particularly with regard to enforcing contracts and promises.
Your brokerage firm and stockbroker have also entered into a contract with FINRA and you are the third-party beneficiary to this contract. Contracts between FINRA and brokerage firms police and govern the actions of brokers to make sure they do business with honesty and integrity, among many other things.
When an FINRA contract or any other contract has been violated, you can make a claim for the damages you suffered as a result.
Try and Get Your Money Back
If you lost money because your broker or brokerage firm failed to keep its promises to you, you may be entitled to full or partial compensation for your damages.
Whether or not your broker willfully intended to breach his contract or if it happened out of negligence, losing your life savings is not only financially devastating, but it can also be emotionally crippling to know you were taken advantage of by someone you trusted. If you have fallen victim to a breach of promise fraud, it’s important to remember this is not your fault!
Pursuing a stock fraud claim will teach Wall Street brokerage firms it’s unacceptable to take advantage of innocent consumers or neglect their investment accounts. Your claim may even prevent others from suffering as you have by forcing Wall Street brokerage firms to conduct business with honesty and integrity.
You may be eligible to receive compensation regardless of whether you sold or continue to hold the securities at issue. Contact us today to set up a free consultation. We will listen to your story, answer any questions you may have and discuss your legal rights and options.