Investment Fraud and Securities Class Action Attorneys
Zamansky LLC represents investors involved in a number of securities class actions, including ERISA violations, Ponzi schemes, issuer misrepresentations or omissions, hedge funds, and REIT cases.
In ERISA suits, our securities fraud attorneys represent employees who have invested in their companies’ stock through 401(k) or other retirement savings plans. ERISA is a federal statute designed to ensure that employees who save and invest for their retirement are treated fairly and honestly by their employers. If the company’s savings plan offers its own stock as one of the investment options, then the individuals who administer the plan owe a fiduciary duty to the investor-employees. This fiduciary duty obligates the plan administrators to act in the investor-employees’ best interest. Part of acting in the employees’ best interest requires careful monitoring of the management of the company and ensuring that the company is honestly disclosing its financial condition to the public. Plan administrators must also make certain that the company has effective risk-control systems in place to protect the company in case it runs into problems. When the plan administrators fall short of these duties and substantial losses result, the company and the plan administrators can be subject to liability to their employee-investors.
In Ponzi scheme cases, our investment arbitration lawyers represent investors who were defrauded by targeting third-party companies who negligently performed their duties and allowed the frauds to succeed. For example, if a Ponzi scheme targets people saving for their retirement, the fraudster will often employ the services of an individual retirement account (IRA) custodian. The custodian is expected to hold the securities, issue accurate statements of the accounts and perform periodic audits of the accounts to ensure that their customers—the investors—are being properly served. In a Ponzi scheme, sometimes there are no actual investments held by the IRA custodian (as in the case of Bernard Madoff). When the IRA custodian fails to detect this and issues false account statements reflecting that the account does in fact hold the securities, the custodian may have been acting negligently and culpably. If, after investigating the facts of an alleged Ponzi scheme, your investment losses lawyer will determine that a third-party company may be liable for some portion of the victims’ losses, we will represent a class of victims in a class action against the culpable third party.
In issuer cases, investment arbitration lawyers represent investors who bought stock in a public company as a result of misleading statements – either misrepresentations or omissions made by the issuer. Issuers of securities are required by federal and state statutes and common law to refrain from misleading the investing public. When issuers fall short of this requirement, they can be liable for any resulting losses. There are countless ways in which issuers can breach their legal duties, but some of the most common involve accounting fraud, misstated earnings, false claims about the financial condition of the company and failures to disclose a key aspect of a securities offering. Oftentimes the issuers’ misrepresentations lead to their company’s stock price being artificially inflated, so investors who purchase at that higher price are harmed. Once the misrepresentation is revealed, the stock price can plummet, harming investors again as the truth comes to be known by the market. In cases such as this, we represent investors against the issuers and, where appropriate, any underwriters who may have breached their due-diligence or other legal duties.
In hedge fund fraud cases, we represent investors who purchased interests in hedge funds in reliance on misleading statements by the funds, or who held their shares not knowing that the fund had engaged in an undisclosed “style drift,” or a shift away from one asset class and into another. Even though hedge fund investors tend to be above average in terms of wealth and sometimes investment experience, they still have the right to full and fair disclosure. Where hedge fund managers or their corporate superiors hide the truth regarding investment strategy, risk factors or conflicts of interest, and their misconduct leads to losses, they can be liable to their investors.
In REIT cases, we represent investors who invested in REITs in reliance on misleading statements by the issuers. This type of action may arise when a REIT assures its investors that it will pay a consistent dividend or that it will invest only in high-quality properties, only to cut its dividend or waste investor funds on low-quality properties. FINRA has repeatedly cautioned investors to be careful of REITs that sound too good to be true. FINRA has also issued guidance to investors on how best to analyze whether a REIT is an appropriate investment to meet their investment objectives and conform with their tolerance for risk.
If you have invested in any of these types of securities or funds and you have suffered losses as a result of misconduct by a brokerage firm, fund manager, issuer or third party, contact our securities fraud law firm today. Our FINRA arbitration attorneys will discuss your legal rights and investigate your claim to determine whether a class action case is the best vehicle for you to recover your losses.