Overcharging is just like it sounds: a brokerage firm charges you more than it should have for a particular service or transaction. Sometimes it requires a bit of investigation to detect whether or not you were charged too much. Other times it’s inherently obvious.
Overcharging can happen intentionally and out of negligence. But even if it happened by accident, brokerage firms usually require legal encouragement before they’re willing to pay you back the money you’re owed.
If you suspect your brokerage firm charged you more than it should have, you may have a very strong claim to get your money back through FINRA (Financial Industry Regulatory Authority) arbitration proceedings.
How Overcharging Happens
One kind of overcharging is fee-related (i.e., it involves transaction fees, management fees, and other charges). In such cases, an investor fraud lawyer can review the initial contracts you signed, and other account opening documentation to determine if a violation occurred.
Another type of overcharge happens when a brokerage firm charges you more for an investment than they actually purchased it for. As you know, investments rise and fall in price during a day of trading. Let’s say a stock traded at a low of $50 per share and a high of $60 per share during one day. Imagine a brokerage firm purchased 10 shares of stock for you at $50 a share, but charged you $60 per share (in addition transaction fees), while keeping the difference as profit for themselves. Such would be a very clear example of overcharging.This kind of overcharge was much more common in the past. Nevertheless, both varieties continue to happen today.
Victims of overcharging fraud may qualify for full or partial compensation for the money they lost. Pursuing a stock fraud claim will not only teach Wall Street brokerage they can’t prey upon innocent investors, but it can also prevent others from suffering as you have by forcing brokerage firms to do business with honesty and integrity.
It doesn’t matter if you sold or continue to hold the investments at issue in your claim. The Consumer Investor Resource Center can help. Contact us 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.