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Investor
Recovery Center
Sacramento law
office:
litigation, business law, and arbitration
Will You Be Able to Collect?
If
you are able to get an award or judgment, you still have to collect it.
Whether you can do so depends primarily on whether at least one of the
parties against whom your judgment or award runs can be found and that
has an viable business or other assets that can be found. There's an
old
saying in law that there's no point in suing a turnip because, as we
all
know, "you can't get blood out of a turnip." This is why, before you
bring
your claim, you should consider whether any of the defendants will be
able
to pay any award or judgment.
Collecting is made easier by the fact that, in many cases, several
parties
may be responsible for a broker's misconduct besides the broker
himself.
For example, more than one broker may have participated in the
wrongdoing.
The broker's supervisor may also be responsible on a controlling person
or negligent supervision theory. The broker's firm is almost always
responsible
on a respondeat superior theory, as well as under controlling person
principles.
Certain officers, directors, and shareholders may also be responsible
under
common law principles, federal controlling person liability, or state
statutory
rules of vicarious liability applying to securities fraud. Even where a
firm is insolvent, it sometimes has insurance that will pay a judgment
or award.
In addition, if you get an award in an arbitration before the
National
Association of Securities Dealers, the collection of your award is
usually
very simple. The rules of FINRA (formerly NASD) require that
arbitration awards be
paid
promptly, on pain of disciplinary proceedings against the broker.
Therefore,
if you have a FINRA arbitration award against an individual broker or a
firm that wants to continue to be in the securities business, they
almost
invariably pay. In addition, if you do business with an established and
reputable securities firm, you will probably have no trouble collecting
an award or judgment. In other situations, it is important to make sure
that you include everyone with liability in your claim in order to
improve
your chances.
For more information or a free consultation, 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. 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 8, 2008
Copyright © 1999-2008 Vincent DiCarlo