Explained by a Stockbroker Fraud Lawyer
In most cases, unless an investor has granted a broker written authorization to make transactions on his or her behalf without prior approval, the broker must obtain permission from the investor prior to executing any orders. A broker who buys or sells securities in an investor's account without the prior consent of the investor has engaged in unauthorized trading unless the broker has "discretionary trading authority" through a written power of attorney.
Even in cases where an investor has granted a broker written authorization to make transactions on the investor's behalf at the discretion of the broker, the broker cannot misuse or exceed that authority by making commissions on unsuitable trades or trades the broker was not authorized to make. To do either is a violation of the broker's duty to the investor and subjects the broker to liability for unauthorized trading.
What You Need to Know About Unauthorized Trading Claims
When it comes to unauthorized trading claims, you have to show the following:
- The unauthorized transactions took place
- You did not grant your broker prior permission to make these trades
- You suffered financial loss due to the unauthorized transactions
Unauthorized trading cases are generally handled in mandatory securities arbitration before the Financial Industry Regulatory Authority (FINRA). That means your case will most likely not be taken to court.
As you consider pursuing an unauthorized trading claim against your broker or brokerage firm, you need to educate yourself on what to look for in an attorney. You should be represented by a broker fraud lawyer who possesses the skills, resources and experience to properly handle your claim. Not every attorney has these qualifications.
Meyer Wilson is a nationally recognized firm that devotes its practice solely to representing investors in claims against brokers and financial advisors and pursues class action lawsuits. We have successfully handled hundreds of cases throughout the nation. Our law firm has become one in which other lawyers refer to when they have clients who have suffered financial loss from investment fraud and stockbroker misconduct.
How Meyer Wilson Is Prepared to Help
With over fifty years of combined legal experience, and having successfully represented over 800 individual and institutional investors, the securities arbitration lawyers at Meyer Wilson have the expertise, experience and resources necessary to review, investigate and aggressively pursue your unauthorized trading claim.
We have won hundreds of millions of dollars in losses for clients nationwide, including in cities such as Los Angeles, Dallas and Tampa. For assistance with your unauthorized trading claim, call us or complete our online form for a free case evaluation.