I have significant experience recovering money lost through the improper conduct of stockbrokers. While my practice in recent years has been geared to the defense of small and medium sized brokerage firms, my years of experience litigating against large brokerage firms can operate to your advantage in the effort to secure a substantial recovery for your losses.
Ironically, it is precisely because I have extensive experience defending small and medium sized brokerage firms that I intimately understand the best way to proceed on your behalf.
When you invest or trade in stocks, bonds, options or other securities, the market risk is yours. However, if that risk is increased through the actions of your broker, you may be able to recover money through the securities arbitration process.
If you have lost more than $150,000.00, I can help you determine if the loss was due to broker misconduct and how best to proceed to help you recover your losses.
The following are some of the types of broker misconduct than can form the basis of a claim that would enable you to recover money:
- Unauthorized trading
- Unsuitable recommendations
- Excessive use of margin
- Penny stock violations
- Failure to disclose important information
- Misrepresentations made to get you to buy a stock
- Excessive commissions and fees
- High pressure sales tactics
- Front running
- Failure to execute a trade instruction
- Selling an unregistered security to you
- Selling anything to you while not being registered in your state
- Exceeding your risk tolerance
- Theft of assets
- Phantom trading
Types of Claims
If a broker engages in any misconduct, including the types of misconduct listed above, and if you have lost money, you can assert a wide variety of claims in an effort to recover the part of your losses attributable to that misconduct. Among the types of claims you can bring, in no particular order, are:
- Securities fraud
- Common law fraud
- Breach of Contract
- Breach of fiduciary duty
- Breach of duty of good faith and fair dealing
- Unjust enrichment
- Failure to supervise
- Violation of consumer protection laws (in some states)
- Elder abuse
In addition to your actual losses, you can also ask for exemplary damages, also called punitive damages. In many states you can ask for an award to cover your attorney fees as well.
Since the 1980s, the dominant arena for resolving claims and disputes between customers and stockbrokers has been arbitration. The securities industry in the United States is regulated through multiple agencies and organizations such as the SEC, the securities regulators of each state, and the various stock exchanges and associations, which are sometimes known as Self-Regulatory Organizations, or SROs.
The SROs provide facilities for the arbitration of disputes. Over the years one SRO has stood out among the rest as the primary arena for the arbitration of disputes. Formerly known as the National Association of Securities Dealers, Inc., or simply "NASD", it is now known as the Financial Industry Regulatory Authority, or "FINRA". This SRO has offices throughout the country to facilitate and handle the large number of securities arbitrations filed every year.
Depending on the contract with your brokerage firm, you may be able to arbitrate the dispute at one of the several private arbitration companies, such as the AAA or JAMS, but NASD is the most likely place.
Arbitration is less formal than courtroom litigation. It is conducted in front of a panel, usually three, of ordinary business people, rather than a judge and a jury. The technical rules of evidence are considerably relaxed. And while there can be substantial fees attached to an arbitration claim, it is generally thought of as far less expensive than a full-blown courthouse litigation.
Securities arbitration is also generally faster than litigation, particularly in New York. However, successfully appealing an undesirable arbitration verdict is far more difficult than appealing an unfavorable litigation verdict. The word "binding" in the phrase "binding arbitration" is particularly apt.
Unlike court cases, arbitration decisions are not generally publicly available. However, FINRA now makes available on its web site, a database of arbitration decisions, which is searchable by any number or parameters, such as party name or attorney name.
Statistics suggest that the majority of disputes between customers and stockbrokers are settled before there are any evidentiary hearings. Frequently, skilled counsel can negotiate an acceptable settlement, subject to your express approval, on your behalf. Sometimes, however, the expectations of each of the parties are too high, and settlement, though desirable, appears almost impossible.
In such instances, it can be advantageous to engage in non-binding securities mediation. In mediation, the parties get to express their feelings and present their claims to a neutral intermediary known as a mediator. They can do so in such a way that they reveal nothing to the other side, thereby preserving their secret trial strategies in the event a mediated settlement is not achieved.
The mediator can present an impartial view of the strengths and weaknesses of each side's case directly to the parties. The mediator's impartial views can then enable the parties to evaluate their positions more realistically. This process has been shown to increase settlements by a substantial factor, ultimately saving time, money and surprise rulings.
Certain types of investments, such as private placements, may be made in a context where there is no contractual obligation to arbitrate a dispute arising out of such investment. In such circumstances, claims can be filed in either state of federal court. Such cases, if not settled or dismissed on motion, go through to a trial. The trial can be either a bench trial (a single judge and no jury) or a jury trial.
Securities litigation is bound by strict rules of evidence. It can involve very substantial costs, particularly in connection with a process called "discovery". Discovery is the means through which each side can minimize the chance of being taken by surprise at trial. This is accomplished by requesting documents in advance, by submitting questions (known as interrogatories) in advance, and by taking depositions (also known as Examinations Before Trial or EBTs) in advance.
As with litigation, arbitration also provides opportunities for discovery, but the opportunities are more narrowly framed. Generally, EBTs are not available in arbitration.
I am experienced in all aspects of the dispute resolution methods discussed above. Because such claims are very fact specific, it is important that you discuss your case in as much detail as possible with your lawyer. For example, an investment that may be quite appropriate for one type of individual may be wholly inappropriate for another type of individual.
I have experience arbitrating claims involving stocks, bonds, mutual funds, options, margin, limited partnerships, commodities, negotiable instruments and a host of investment strategies utilizing one or more of the foregoing.
Settlements / Restitution
I have strong negotiating skills and can help you understand of the risks of going forward as measured against the benefits of a negotiated compromise. I can protect you in structured settlements, where a payout to you is made in installments, over time, through the use of promissory notes and affidavits of confession of judgment issued in your favor.
It sometimes happens that a regulatory agency, such as FINRA or the SEC will engage in efforts to compel a brokerage firm to fully reimburse a customer who has been cheated or who has been sold securities in some improper way. This reimbursement is called restitution. I can help you work with the regulatory agency involved to assure proper calculations so you receive every penny to which you are entitled.
NOTE that nothing on this Web Site can constitute or create an attorney-client relationship between you and Mr. Gelber. An attorney-client relationship can only be established through a written Retainer Agreement, signed by you and Mr. Gelber. An e-mail exchange will not do. This Web Site may not be construed as an offer to render legal advice or services.
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I have recently authored a securities glossary: The
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enjoy my Wikipedia article on Joseph Norman Dolley.
Please feel free to telephone or e-mail me about your particular situation.
There is no charge for an initial telephone consultation.