Deceptive Trading Practices Attorneys
If you have suffered losses with your broker due to deceptive trading practices, the securities attorneys at The White Law Group may be able to help you.
Deceptive trading practices by a broker involve actions that mislead or manipulate the market.
Identifying whether your broker has engaged in deceptive trading practices can be challenging, but there are certain signs and red flags that may indicate potential misconduct. Here are some key indicators to help you decide if you need a deceptive trading practices attorney:
Unauthorized Transactions:
Review your account statements for any trades or transactions that you did not authorize. Unauthorized trading can be a deceptive practice, especially if your broker executed trades without your knowledge or consent.
Excessive Trading (Churning):
Excessive trading, also known as churning, involves making frequent trades to generate commissions for the broker. If you notice an unusually high number of trades in your account that seem unnecessary and primarily benefit the broker, it could be a sign of deceptive practices.
Misrepresentation or Omission:
Evaluate the information provided by your broker about investment products, risks, and potential returns. If your broker intentionally provided false information, omitted key details, or misrepresented investment opportunities, it may constitute deceptive practices.
Failure to Disclose Fees and Costs:
Brokers must disclose all fees, costs, and potential conflicts of interest associated with investment products. If your broker fails to provide transparent information about expenses, it could be indicative of deceptive practices.
Unsuitable Recommendations:
Brokers must recommend investments that are suitable for your financial situation, risk tolerance, and investment goals. If your broker recommends investments that are clearly unsuitable for you, you may need a deceptive trading practices attorney.
Front-Running:
Front-running occurs when a broker executes trades on their own behalf before executing orders for their clients. If you suspect that your broker is placing their interests ahead of yours by front-running, it could be a deceptive trading practice.
Late Trading or Market Timing:
Late trading involves placing orders after the market has closed but recording them as if they were placed earlier. Market timing refers to frequent buying and selling of a security to exploit short-term market fluctuations. Both practices can be deceptive and may harm investors.
Lack of Transparency:
Deceptive brokers may avoid providing clear and comprehensive information about investment strategies, risks, and potential downsides. If your broker lacks transparency, it raises concerns about their intentions.
Unexplained Losses:
Significant and unexplained losses in your investment portfolio may be a result of deceptive trading practices. If you are experiencing losses without a reasonable explanation, investigate the trades conducted by your broker.
If you have suspicions or concerns about deceptive trading practices, consider consulting with a securities attorney or filing a complaint with regulatory authorities like FINRA (Financial Industry Regulatory Authority). They can help you investigate and take appropriate actions to protect your interests.
Examples of Deceptive Trading Practices
Front Running: The broker executes orders on a security for its own account while taking advantage of advance knowledge of pending orders from its customers.
Churning: Excessive buying or selling of securities by a broker to generate commissions without regard to the customer’s investment goals.
Pump and Dump: The broker promotes a security with false or misleading statements to artificially inflate its price, and then sells the security at the higher price.
Marking the Close: The broker manipulates the closing price of a security by executing trades at or near the market close.
Spoofing: Placing and quickly canceling large orders to create a false impression of demand or supply, influencing the market price.
Insider Trading: Trading on material, non-public information about a security’s price or a pending corporate action.
Wash Trading: Simultaneously buying and selling the same security to create misleading activity and potentially inflate volume.
Layering: Placing multiple orders with the intent to cancel them before execution to create the appearance of market interest.
These practices are illegal and violate securities laws. If your broker is engaging in these deceptive trading practices you may need an attorney.
FINRA Rules Regarding Deceptive Trading Practices
FINRA, the Financial Industry Regulatory Authority, has various FINRA Rules in place to protect investors from deceptive trading practices. Here are some key FINRA Rules and regulations enforced by FINRA:
FINRA Rule 5270 – Front Running of Block Transactions FINRA Rule 5320 – Prohibition Against Trading Ahead of Customer Orders FINRA Rule 2010 – Standards of Commercial Honor and Principles of Trade FINRA Rule 5210 – Publication of Transactions and Quotations FINRA Rule 2020 – Manipulative and Deceptive Activities FINRA Rule 5750 Series – Disruptive Quoting and Trading Activities FINRA Rule 6140 – Other Trading Practices FINRA Rule 201 of Regulation SHO – Close-out and Pre-borrowing Requirements These FINRA Rules, among others, contribute to the regulatory framework that governs broker-dealers and protects investors from deceptive trading practices in the securities industry. It’s important for investors to be aware of these FINRA Rules and report any suspicious activities to regulatory authorities.
If your Broker Engages in Deceptive Trading Practices
If you believe your broker has engaged in deceptive trading practices and you have suffered financial losses as a result, you may have recourse through various avenues:
FINRA Arbitration:
You can file a complaint with the Financial Industry Regulatory Authority (FINRA). Most brokerage agreements require arbitration to resolve disputes. FINRA operates a dispute resolution forum where you can present your case before a panel of arbitrators.
SEC Complaint:
If you believe the broker’s actions involve serious misconduct or violate securities laws, you can file a complaint with the Securities and Exchange Commission (SEC). The SEC investigates and takes enforcement actions against securities law violations.
State Securities Regulator:
You may also file a complaint with your state securities regulator. Each state has its own regulatory body responsible for overseeing securities industry activities within its jurisdiction.
Consult an Experienced Securities Attorney:
Consider consulting with an attorney who specializes in securities law, such as the attorneys at The White Law Group. They can provide legal advice, evaluate the strength of your case, and guide you through the appropriate legal channels.
Remember to keep thorough records of all transactions, communications, and any evidence related to the deceptive practices. Prompt action is key, as there may be time limitations for filing complaints or initiating legal actions. Consulting with legal professionals can help you navigate the complexities of the regulatory process and protect your rights as an investor.
Securities Attorneys for Deceptive Trading Practices
The securities attorneys at The White Law Group can be instrumental in helping you address deceptive trading practices by your broker in the following ways:
By assessing the details of your situation, reviewing documents, transactions, and communications to determine the strength of your case, they will help you understand if you have a viable claim against your broker.
Our attorneys can provide legal advice tailored to your specific circumstances. They will explain your rights, potential claims, and the legal options available to you. Based on their experience, they can help you develop a strategic plan for pursuing a resolution.
The securities attorneys at The White Law Group are experienced in interacting with regulatory bodies such as FINRA, the SEC, and state securities regulators. They can help you file complaints, navigate regulatory processes, and ensure that your case receives proper attention.
If your case proceeds to arbitration or litigation, we can represent you throughout the legal proceedings. They will prepare your case, present evidence, cross-examine witnesses, and argue on your behalf.
They are also skilled negotiators and can engage in settlement discussions with the brokerage firm or other parties involved. They will work to secure a favorable settlement that compensates you for your losses and addresses the deceptive practices.
Engaging a securities attorney can be key in navigating the complexities of securities law, arbitration, or litigation. They serve as your advocate, protecting your rights and working towards a resolution that aligns with your best interests.
Filing a Complaint against your Brokerage firm
Brokers have a fiduciary duty to perform adequate due diligence on any investment before recommending it to investors. If you think your investments were not suitable for you, and you have suffered losses, you may have a viable claim against your brokerage firm.
If you need a deceptive trading practices attorney, the securities attorneys at The White Law Group may be able to help. Please call the offices at 888-637-5510 for a free consultation with a securities attorney.
The White Law Group, LLC is a national securities fraud, securities arbitration, investor protection, and securities regulation/compliance law firm with offices in Chicago, Illinois and Seattle, Washington. Since the firm launched in 2010, it has handled over 700 FINRA arbitration cases.
For more information on the firm, please visit https://www.whitesecuritieslaw.com.
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