Investments, Securities, and Broker-Dealer Disputes

  • The firm handles complex investment cases, especially lawsuits involving securities broker-dealers, and has repeatedly represented both customer plaintiffs and broker-dealer defendants in these cases. Additionally, Burt Senkfor was a longtime arbitrator (and chairperson of arbitration panels) for the National Association of Securities Dealers (“NASD”), the predecessor to the Financial Industry Regulatory Authority (“FINRA”).

    Burt Senkfor has extensively represented financial investment institutions and personnel, such as major securities broker-dealers, municipal securities dealers, registered commodity trading advisors, commodity pool operators, investment advisors, and registered representatives, and knows the legal issues, strategies, and recordkeeping (where the key evidence is located) from all perspectives, which provides a significant advantage in the representation of investors in disputes with financial institutions.

People make money and people lose money on investments. Most investments have risks, and market events and forces (both anticipated and unexpected) can change values. But sometimes losses materialize or increase, or profits decrease, because of improper conduct by someone involved with the investment. And oftentimes such improper conduct is hidden, or cannot be recognized by the investor, or even discerned by an attorney if the attorney does not specialize in securities/investments.

There are many types of improper conduct which can be committed by a securities broker-dealer. The Senkfor Law Office has extensive experience representing all sides of these disputes – investors, broker-dealers, and registered representatives – and Burt Senkfor has also adjudicated numerous such disputes as a securities arbitrator.

Suitability means that a particular investment is appropriate for a particular investor at a particular time. Because of risks, time concerns, tax considerations, and other factors, certain investments are appropriate for some investors but not for others. In order to determine whether a particular investment is suitable for an investor, the broker-dealer must attempt to ascertain various elements relating to the customer’s financial situation, which include age, dependents, income, net worth, other investments, financial sophistication, risk tolerance, tax situation, and monetary needs. If an investor loses money because of an unsuitable investment, the investor may be able to recover such damages from the broker-dealer.

Misrepresentations and omissions sometimes occur when an investor is deciding whether to purchase or sell an investment. These can relate to future price expectations, guarantees against loss, supposed company news or upcoming developments, earnings, products, governmental action, other investors, or countless other types of information. Sometimes only part of the story is disclosed, omitting other facts necessary in order to prevent the information which was provided from being misleading. Or only the possible upside was discussed, and substantial risks known to the broker-dealer were omitted or minimized. Or the broker-dealer may have a significant relationship to the investment, such as owning a sizeable holding and/or selling from its own account. There might be a limited market for the investment, or restrictions on resale, making it difficult for the investor to resell, which may not have been sufficiently disclosed.

Churning is when there is excessive trading in an account, for the purpose of earning commissions for the broker-dealer. Even if the account is profitable, the amount of overall commissions may exceed the profits, and the level of trading may have been inappropriate. The frequent trading may not have been in the best interests of the investor.

Unauthorized trading is when a transaction is made for the investor’s account without the investor’s specific advance approval, unless there is a preexisting written discretionary trading authorization. A broker-dealer cannot properly make a trade for the investor’s account first, and then seek authorization, even if it was a supposed great opportunity or the investor could not be reached beforehand.

Broker-dealers and life insurance companies also frequently sell variable annuities, particularly to elderly people. These are often unsuitable transactions for the investor, with high risks and fees. Damages can be recovered for such improper sales. Also, additional damages may be obtained pursuant to elder abuse statutes when the person victimized is at least 65 years old, in these and other financial cases.

The Senkfor Law Office has successfully handled many additional types of wrongdoing claims against broker-dealers, including claims relating to manipulation of stock prices by reports and recommendations of broker-dealer investment analysts, selling of unauthorized outside investments to investors, failure to monitor managed discretionary accounts, disputes with market makers relating to inside information, improper short and margin transactions, sales of restricted stock, purchases of multiple mutual funds just below breakpoint discount levels, borrowing by registered representatives from investors, and failures to supervise.

The Senkfor Law Office serves clients and handles matters throughout Southern California, including Beverly Hills, Los Angeles, Santa Monica, West Hollywood, Glendale, Pasadena, Long Beach, Torrance, San Fernando Valley, Orange County, Riverside County, and San Bernardino County, as well as San Diego, San Francisco, and Fresno, relating to Corporate, Shareholder, and Partnership Disputes, Investments, Securities, and Broker-Dealer Disputes, Lawsuits Against Attorneys, Insurance and Annuities, Contracts, and Other Business Litigation.

© 2024 Law Office of Burton Mark Senkfor
8484 Wilshire Boulevard, Suite 660, Beverly Hills, CA 90211
| Phone: 310-274-4100

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