Americans are most likely to invest in the stock exchange. Gallup Poll results show that around 55% of US residents own individual stocks, mutual fund, or equities within a 401k or IRA. Stockbrokers are not as popular as they once were. While they view them as professionals, they worry about fraud and theft. The average business lawyer believes they might be correct to do so. If you need a trusted lawyer to help secure or lose your investment, you can check experienced lawyers on investment fraud lawyer
A Growing Trend
Everyone was shocked to learn that high-profile stockbrokers and investment advisors as well as financiers are routinely taken to prison for bilking people of their life savings. It begs the question, “How safe is my money?” You need to know what duties a stockbroker holds to his customers to help you determine how much protection an investor has from malfeasance.
You may have heard the terms “fiduciary responsibility” and “fiduciary duty”. One who manages money for another person is called a fiduciary, and the beneficiary is not surprising. The fiduciary must legally put the interest of the beneficiary before his own. This is what is called his fiduciary obligation or responsibility. But, the relationship between an investor’s stockbroker and him is not always complete.
A Series 7 licensed regular broker is often called a “registered representatives”. Registered investment advisers, however, are fiduciaries. This is because they plan your financial future and not trade securities. Stockbrokers could still be accused of misconduct or face criminal charges. These cases are often more complex than those of brokers with fiduciary responsibilities.
What is Fraud?
Broker fraud is a broad term used to describe a trusted financial adviser who is accused of lying or deceiving, theft, unauthorized transactions and poor investments. Churning occurs when a registered representative engages in excessive trading to generate commissions for himself, and not for his client, who is the investor.