Laws differ from state to state, and how a claim is handled in New York might be quite different than how it might be treated elsewhere. This is why securing the guidance of someone who understands the laws applicable to a specific state or US Territory where the claim will be litigated is essential. When confrounted with securities litigation claims, finding the right representation in Puerto Rico is especially important.
Securities litigation is a complicated area of law, particularly because of the complexity of FINRA and SEC Rules and regulations as well as federal and state securities laws. Although an investor may lose money that does not necessarily mean that the investor has a legitimate claim. A thorough understanding the standards, rules and laws applicable to the securities industry is critical to evaluating whether you may have a legitimate claim to recover investment losses.
Some offenses may appear similar or even identical, but they are not. Understanding the nature of different offenses may help a victim of a securities violation better understand his or her situation.
One such offense is called churning, and refers to when a broker uses a client’s account to engage in unauthorized excessive training. This usually ends with the investor losing a significant amount of money. Failure to diversify is another action that generally produces the same result. This is when a broker places of a client’s assets into just one single industry or stock. Investing in different areas — diversifying — reduces the risk of investing in a changing market.
Brokers are not the only ones who can harm investors. Brokerage firm managers should regularly monitor trading activity, gains and losses. This is a simple method to identify any possible wrongdoing that may be going on.
Investing is not without risks, and investors in New York and elsewhere understand that losses are possible. Those losses should not be the result of broker misconduct, but this is unfortunately sometimes the case. Speaking with someone who understands the importance of accurate representation in Puerto Rico can be helpful when considering how to recover any losses.