Broker Misrepresentations

What Should I Do If My Broker Made Misrepresentations About My Investment and I Lost Money? 

SEC Orders Titan To Pay $1M Over Ad That Used Hypothetical Returns

In its first enforcement action related to a new marketing rule involving hypothetical-performance ads, the US Securities and Exchange Commission (SEC) is ordering Titan Global Management to pay $1,042,454. The FinTech investment adviser is accused of violating the regulator’s marketing rule by advertising incredibly high-performance outcomes for its “Titan Crypto” investment strategy. The firm claimed there could be, purportedly, annualized returns of 2,700% but gave that projection without providing any material information or context.

This could have included noting that the returns marketed were from a “purely hypothetical account” and could only occur for real if the strategy’s performance for its first three weeks were to continue for a whole year. The investment adviser was also accused of not including key information about the “risks and limitations” that came with making investment choices based on a hypothetical performance in its ads.

Shepherd Smith Edwards and Kantas (investorlawyers.com) represent clients who have suffered losses because their broker or investment adviser made misrepresentations about an investment they recommended, left out certain key material facts, or failed to properly disclose the risks. We work with investors to recoup damages.

 

What Should I Know About Misrepresentations and Omissions?

If your financial advisor neglected to properly disclose material facts that you should have known about, you may have grounds for suing them. Broker-dealers are not allowed to issue materially false information, leave out key facts, or make misleading statements—especially when any of this may impact a client’s decision about whether to invest.

As a matter of fact, brokerage firms are supposed to disclose all material information and facts related to the sale, purchase, or recommendation of an investment. They are also required to conduct the proper due diligence to make sure they have all of the information that they should disclose to you.

A few all too common examples of misrepresentations and omissions by a financial advisor: 

• Oversimplifying a complex investing strategy and touting it as low-risk and safe.
• Making misleading statements in marketing materials, offering prospectuses, presentations, or in other types of communication.
• Neglecting to disclose any pertinent new or negative information about a financial product or the issuer that has come to light since the customer  invested.
• Failing to disclose any conflicts of interest, such as how the broker may be benefiting from marketing and selling a specific kind of security to you.

Not only can misleading, omitted, or inaccurate information cause someone to invest in a security or financial product they might otherwise have stayed away from, but also it can lead to serious investment losses.

Should I Sue My Broker?

The best way to answer this is to explore your legal options with a knowledgeable misrepresentations and omissions lawyer who can assess whether your losses warrant grounds for a broker fraud lawsuit. Shepherd Smith Edwards and Kantas have been representing investors for over 30 years. We have helped thousands of clients to collectively recover many millions of dollars.

Call (800) 259-9010 today to schedule your free, no-obligation case consultation.