We are constantly told the importance of making investments, as it could be crucial to the financial stability of one’s future and the future of their loved ones. However, when one is not fully versed in the different types of investments, they may not be able to detect misconduct by a broker or any other professional in charge of these investments. Thus, many instances of securities fraud often go undetected until one is at a loss of their investment. When it comes to securities fraud, many do not know what to look for. This is why it often goes undetected. Thus, this post will explore the common signs associated with securities fraud.
To begin, there are some initial signs that often cause individuals to be unsure or confused about the matter. This includes his or her broker not returning calls or transactions on statements that do not make sense. This could be followed by more obvious signs, which includes unauthorized transactions on a statement, unidentifiable debits or credits on monthly account statements, a dramatic drop in the value of stock in a short period of time, losing money in an “up” market, most investments recommended by the broker are declining in value, or one’s broker refers to market news as entertainment.
Then, there are more troubling signs. This can include a broker failing to disclosing important information following an investment purchase, one’s broker trading in high risk and speculative investments, paying capital gains taxes even though one’s account value is decreasing, or experiencing financial results that are significantly different from the expectation publicly announced.
If one suspects that securities fraud may be occurring, it is important to understand what steps one could take to address this problem. Navigating these matters can be confusing, making it valuable to seek legal guidance so this conduct is not only detected but proper action is taken to resolve the matter.