Stockbroker Fraud
Investor
Recovery
Center
Stockbroker Fraud, Lies, and Misrepresentationsfraud
Stockbroker fraud usually involves stockbroker
misrepresentations, which is legalese for
"stockbroker fraud". Often,
stockbroker fraud occurs in the context of boiler room operations, from
which
teams of bad stockbrokers with a history of fraud, including lies
and
misrepresentations, make a high volume of cold calls using high
pressure
tactics and fraudulent statements.
Sometimes,
whole account statements are forged to
cover up the stockbroker's fraud, theft, or misconduct.
Under the law, even a prediction or statement of opinion by a
stockbroker
can consitutute stockbroker fraud when it has no reasonable basis.
Statements
by a dishonest stockbroker that a particular stock "will break 50 by
June" or
the
like almost never have a reasonable basis, can be stockbroker
fraud,
and can be grounds for a claim if the investor reasonably relies upon
the broker's fraudulent statements
in making a losing investment.
Some of the most commonly heard lies and misrepresentations from
actual stockbroker fraud cases are:
- "This stock is a sure thing." This is never true, and always
constitutes stockbroker fraud and misrepresentation.
- "This stock will hit 50 by June." There is no legitimate way any
broker can say this. It is almost always stockbroker fraud.
- "You can get your money out any time you want." This is not true
for
many illiquid investments, such as most limited partnerships, or for
investments with a back end commission or penalty for early withdrawal.
In those cases, it is stockbroker fraud.
- "We will monitor your account and sell you out before you lose
money." This is often not done, and often cannot be done due to a thin
market in some
highly promoted stocks. If knowingly false this statement constitutes
stockbroker
fraud and misrepresentation.
- "You are getting in on a hot public offering." Sometimes this is
true, but sometimes the brokerage firm is selling you its own stock out
of inventory that it bought at a much lower price than what you pay.
Then it is stockbroker fraud and
misrepresentation.
- "The company is about to announce a merger." If the broker has
no
basis for saying this, it is stockbroker fraud and misrepresentation.
- "The company is about to announce a major deal with a large
company."
If no basis, stockbroker misrepresentation and fraud.
- "We control the price of the stock and are taking it up." If
this
is false, it is a misrepresentation and therefore stockbroker fraud. If
it is true, it is a stock
manipulation.
Either way, the broker or his firm are guilty of stockbroker fraud and
misconduct.
If you have lost money on an investment in reliance on stockbroker
fraud, lies, or
misrepresentions, you may have a claim for stockbroker fraud that may
be worth
pursuing
.




For more information or a free consultation, concerning
stockbroker fraud call us toll
free nationwide at 800-699-2728 or e-mail us at
vdicarlo@dicarlolaw.com
DISCLAIMER: The information at this site is
provided as a public service concerning stockbroker fraud. It is not
intended as legal advice and
should not be relied upon. You are advised to consult 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.
This
page last
updated on April 10, 2006
Copyright © 1999-2008 Vincent DiCarlo