| As of September 1, 2008, Vincent DiCarlo, who maintained this site, is no longer engaged in the private practice of law. His former law office website is at. |
|
Email |
Failure to Follow Instructions
![]()
Whether
your account is discretionary or nondiscretionary, your broker or
investment
advisor has a duty to follow your instructions with respect to your
account.
If he fails to do so, you have a claim for any losses that may result.
Two common examples of instructions that may not be followed are:
The second scenario is also surprisingly common. I suspect that the reason why some brokers resist instructions to stop using margin is that the instruction usually comes after a decline in the market. If the broker is convinced that the decline is a temporary correction, he may not want the investor to lock in a substantial loss. Of course, if the broker is wrong and the portfolio continues to decline, the result may be a total loss.
Regardless of the scenario, where the failure of a broker or advisor to follow a customer's instructions causes a loss, the investor has a claim that may be worth pursuing.
![]()
DISCLAIMER: Vincent DiCarlo, who
authored and maintained this site, has entered
government service and, as of September 1, 2008, is no longer engaged
in the private practice of law. Therefore, this site is no longer
being maintained, may not be accurate, and should not be relied
upon. It is not now and was not ever intended as legal
advice. It is being provided for historical purposes, and for the
benefit of those lawyers who are capable of independently verifying the
information and judging the opinions in it, and then reaching their own
conclusions. You are strongly advised to consult qualified legal
counsel
before adopting any of the ideas or suggestions in this material, which
may or may not be applicable in your jurisdiction or to your specific
situation, and may no longer be accurate or prudent in any case.
The opinions and statements at this site were solely those of the
author. They
were not and are not those of, nor were they nor are they made on
behalf of, any agency of government or anyone else.
Copyright © 1998-2008 Vincent DiCarlo