Putting Investors’ Interests First
Securities brokers and financial advisors have a duty to put their clients’ interests first. This fiduciary duty forms an important basis of the brokerage-investor relationship. Investors rely upon investment experts to guide them in making appropriate investment decisions. Therefore, investors have a cause of action when brokers or advisors violate their crucial position of trust by failing to act in the investors’ best interest.
The Wall Street-based law firm of Zamansky LLC holds financial advisors and securities brokers accountable for any breach of fiduciary duty associated with junk bond investments. Our investment loss attorneys have substantial experience in legal matters related to market transactions and securities litigation. We focus on recovery of the losses investors incur due to junk bond default or devaluation.
Breach of Fiduciary Duty
A fiduciary duty is the legal obligation of the broker or financial advisor to act in the best interests of the investor. Some breaches are cut-and-dry if the broker or advisor conducts an overtly fraudulent trade with the intention of making money for himself, such as perpetrating a Ponzi scheme or intentionally relaying false information. However, most breach claims arise from less transparent actions.
Examples of breaches of fiduciary duty related to junk bond investments include:
- Failing to conduct due diligence before making a junk bond investment transaction
- Recommending an unsuitable high-risk junk bond investment to a low-risk investor
- Recommending investment in a company in which the broker or advisor has an interest
- Engaging in a trade in which the broker or advisor has a conflict of interest
- Taking inappropriate risks on high-yield stocks in order to earn higher profits or commissions
- Taking risks on high-yield non-investment securities in an attempt to cover up losses
- Communicating insider information related to the company or investment opportunity
- Making multiple inappropriate trades, or churning, to earn transaction fees or commissions
- Outlining only the potential high returns without explaining the potential risks of default and devaluation
Not all losses are attributable to breach of fiduciary duty. The law sets particular standards for proving breach. Our attorneys are well-versed in the statutes and case law that define fiduciary duty and the actions that rise to the level of a breach. We regularly handle FINRA arbitration and class action litigation on behalf of investors who suffered losses as a result of their advisors’ breach of fiduciary duty.
Contact Zamansky LLC about a Breach of Fiduciary Duty Claim
We encourage investors whose non-investment grade bonds have defaulted or devalued to contact the securities attorneys at Zamansky LLC. Our law firm investigates whether the securities broker or financial advisor breached her or his fiduciary duty in recommending and conducting the junk bond transaction. Your claims evaluation is risk-free and confidential and we respond to all inquiries within 24 hours.