Unsuitable Investments
San Antonio Unsuitable Investments Lawyers – (210) 298-6666 - (800) 519-2800
As investors, we know what our end goal is, but we don’t always know how to achieve it. Consequently, we leave our investments and financial well-being in the hands of trained professionals, professionals whom we believe to be honest and have nothing but our best interests in mind when making financial decisions on our behalf. Unfortunately, not all financial advisors and stock brokers place client needs at the forefront of their decisions making process, and unsuitable investments may occur.
An unsuitable investment is exactly what it sounds like. They are investments that are not inline with a client’s needs, and therefore not suitable for that client. For example, if an investor wants to invest conservatively, and a stock broker chooses to put that investor’s assets into high-risk stocks, then such an action could be labeled as unsuitable. Furthermore, unsuitable investments can also be characterized by a client’s lack of understanding, meaning that a broker can fail to fully disclose the risks involved with a certain investment strategy, garner the support of the client, and ultimately make an unsuitable investment.
Financial advisors and brokers have an obligation to act according to their clients’ needs and requests, and any instance where a stock recommendation is made that is a clear diversion from the client’s needs is representative of deceptive sales practice. The reasoning for these deceptive practices typically stems from the broker or advisor wanting to somehow benefit from the unsuitable investment, either through profiting via their own stock purchase or sale after purchasing that same stock with client money (known as front running), or some other deceptive practice which places the greedy needs of the broker ahead of the those of the client.
A financial advisor or broker has a duty to uphold the investment strategy agreement that was entered into with the client. The advisor must fully understand the client’s needs, know how much of a risk the client would be willing to accept regarding an investment, and must handle all client assets legitimately, taking into account tax considerations and the like. Not all advisors are honest though, and some swindled investors may need to retain the services of an experienced Texas securities fraud attorney to hold negligent the negligent advisor accountable for his or her action.
If you feel as though you’ve been a victim of deceptive investment practices, please don’t hesitate to contact the Texas unsuitable investment attorneys at Cichowski & Gonzalez, P.C. Call us today at 800-519-2800 for free initial consultation, and, our experienced financial fraud lawyers will fight to uphold your rights in a court of law.