Financial advisors and stockbrokers have fiduciary responsibilities towards their investors. Meaning, they owe each one of their investors an extremely high degree of loyalty as their positions require a significant level of trust and confidence from their investors. As an investor, when you ask your financial advisor or stockbroker to sell a specific number of shares at the market price, then you have every right to expect that he or she will execute that order as quickly as reasonably possible. However, when an order places limits on the order such as the price, then an investor can reasonably expect that it will take longer for their stockbroker to execute.
Your financial advisor, financial planner or stockbroker has a duty to inform you of any risks involved in a transaction or an investment. When a financial planner or stockbroker is disloyal to you or when they betray your trust or your confidence, then they can be held legally liable for damages. For example, if your broker fails to provide you with information regarding a transaction or if they fail to execute or follow your instruction with respect to your investment, then you may have legal grounds to file a claim against him or her.
Most of the time brokers are inclined to follow their investors directions and place their orders; however, not every broker is 100% perfect, on occasions mistakes are made, brokers get busy and overwhelmed and sometimes they fail to place orders. While technology has reduced this possibility, orders still can and do get lost. When this occurs, investment clients can take legal action for such negligence on behalf of the broker or the firm.
While you expect to have a very loyal relationship with your broker, there are times when a broker either forgets or chooses not to place an order for their client. For example, the client may want to sell a stock but their broker is opposed to the idea, and if the broker refuses to place the order then the client may have a valid point, particularly when the failure to place such an order results in damages; for example, the broker does not sell when he is told to and the price drops. Brokers work for the investors and they have a duty to their clients to properly execute their customers' orders. When a broker fails to follow directions and when they fail to execute trades ordered by their investor, then the broker can be found to be in violation of their duties. Other examples of failure to execute a trade include:
- Failure to obtain the best price during an authorized trade;
- Failure to make the trade in a timely manner;
- Failure to carry out an action that the client believes it to be:
- Failure to sell or buy a given security within a timely manner; or
- Failure to execute any other instructions from the investor with respect to his investments.
Contact the Law Offices of Jonathan W. Evans & Associates
As an investor, you place a great deal of trust and confidence in your broker, not to mention you trust that person with your money. When your broker fails to execute a trade as you previously specified and when such failure results in serious financial losses, it can be very upsetting to say the least. If your broker failed to follow instructions, it would be a wise idea for you to contact a California securities lawyer from The Law Offices of Jonathan W. Evans & Associates to find out if you have a claim against the broker to recover your losses.
Claims vary widely and therefore need to be carefully evaluated by an attorney who is familiar with stockbroker misconduct such as at our firm. Our legal team has tried more than 80 cases to conclusion with the NASD, and we have assisted clients in mediation in a number of other securities cases, and our lead attorney Jonathan W. Evans has represented hundreds of investors with their disputes, many of which have resulted in significant settlements.
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