Valenti Hanley PLLC

10 factors that could lead to financial loss and litigation

When you suffer losses in your investment portfolio that you believe goes beyond the typical actions of the market, you could have some legal recourse. There are several factors that could have contributed to your losses for which you can seek relief.

Some of these factors could be familiar to you:

  1. Conflict of interest. This could be the case if a securities analyst has given a strong rating to a stock that is a client of on the investment banking side of a securities firm. Conversely, this can occur if a competitor has been tagged with a lower rating.
  2. Breach of fiduciary duty. Did your broker in any way violate the responsibility to provide the highest duty of loyalty and fidelity?
  3. Churning. This occurs when brokers make an excessive number of trades for a client to increase commission. Clients can lose money to broker fees and unwise timing of trades.
  4. Malpractice. This occurs when a client receives substandard services. That can include receiving incorrect, misleading or deceptive advice from their broker and make a poor decision as a result.
  5. Failure to diversity. Did your broker put all of your assets in just one stock?
  6. Failure to supervise. Brokerage managers are required to monitor trading activity by brokers, as well as losses by investors.
  7. Inside trading. It is illegal for anyone with inside knowledge about a company to buy or sell that company's stocks based on that inside information.
  8. Market manipulation. If a broker - or a company or individual investor - does something to create a false impression about a certain security and its trading activity or other factors, that's market manipulation.
  9. Trading without permission. Brokers are required to let their clients know about trades.
  10. Misrepresentation. People who work in securities cannot give out wrong information or hide the real information, such as in a company's public filings.

These are just 10 of the instances that could lead to securities litigation. If you have sustained a financial loss and believe your broker could be at fault, an attorney with experience in securities litigation can assess your situation.

No Comments

Leave a comment
Comment Information
Email Us For A Response

Protect Your Interests

Call us at 502-208-5017 or fill out the form below to schedule an initial consultation with an experienced attorney.

Bold labels are required.

Contact Information

The use of the Internet or this form for communication with the firm or any individual member of the firm does not establish an attorney-client relationship. Confidential or time-sensitive information should not be sent through this form.


Privacy Policy

Valenti Hanley PLLC
401 West Main Street
Suite 1950
Louisville, KY 40202

Toll Free: 866-617-6209
Phone: 502-208-5017
Fax: 502-568-2101
Louisville Law Office Map

Map Marker