Are You Entitled to Investor Compensation? Find Out from an Experienced Stockbroker Fraud Attorney
As an individual investor, market fluctuations aren’t the only threat to your portfolio. Stockbroker fraud is a very real risk as well. If you suffer fraudulent losses, you can hire a stockbroker fraud lawyer to represent you—and this may be your only practical option under U.S. law.
Although some European countries have implemented investor compensation funds in recent years, the United States has not. As a result, it is up to individual investors to assert their legal rights and proactively seek any funds they may be entitled to recover. While you can pursue a claim on your own, you can also hire a lawyer to represent you at no out-of-pocket cost.
Compensation Funds for U.S. Investors
While the U.S. does not have an investor compensation fund, funds may be established in certain cases. For example, options that will be available to some investors include:
- SEC Enforcement Action Funds – The SEC pursues enforcement actions in some cases. If an SEC enforcement action results in the recovery of investment funds, defrauded investors may be able to secure a portion of these funds from the SEC.
- Class Action Settlement Funds – When a securities class action results in a settlement, individual investors may be able to apply to receive a portion of the overall settlement fund.
However, these funds typically only provide investors with the ability to recover a fraction of their fraudulent investment losses. To recover full compensation for their fraudulent losses, defrauded investors must pursue claims of their own.
Recovering Full Compensation for Fraudulent Investment Losses
While most victims of stockbroker fraud in the U.S. cannot recover their losses through an investor compensation fund, they can seek to recover their losses directly from their broker or brokerage firm. The primary options for seeking to recover full compensation for fraudulent investment losses are:
1. FINRA Arbitration
All registered stockbrokers in the U.S. are required to submit to FINRA arbitration to resolve investor claims. In FINRA arbitration, investors can seek to fully recover their fraudulent losses, including losses due to the loss of investment opportunities.
2. Stockbroker Fraud Litigation
While most stockbroker fraud claims will proceed through FINRA arbitration, investors may need to pursue litigation in some cases. An experienced stockbroker fraud attorney will be able to determine the steps you need to take in order to hold your broker accountable.
3. Settlement Negotiations
Whether investors have FINRA arbitration claims or they need to pursue litigation, many stockbroker fraud claims are resolved through settlement negotiations. Stockbroker fraud claims can be settled at any stage of the process, and an experienced stockbroker fraud attorney can negotiate on your behalf while helping you decide when (and if) to settle.
Schedule a Free Consultation with a Stockbroker Fraud Lawyer Today
If you need to know more about your options for recovering fraudulent investment losses, we encourage you to contact us. Please call 212-742-1414 or contact us online to schedule a free consultation with a stockbroker fraud lawyer at Zamansky LLC.