Breach of Fiduciary Duty

Brokers have the duty to act in your best interests, including allocating assets in accordance with your goals, financial situation and needs, and risk tolerance. That means not practicing in overconcentration, churning, high risk investments, or other bad practices. If your broker or financial advisor fails to act as your fiduciary in your best interest when managing your assets, you may be qualified to join the thousands of investors who bring claims for breach of fiduciary duty in arbitration every year.

Brokers and investment advisors are considered to have a fiduciary relationship with their clients. This relationship means that brokers (the fiduciaries) have a legal obligation to serve the best interests of their clients (the principals). Courts closely examine this type of relationship, because it imposes one of the highest levels of care that is legally required. Fiduciaries are required to uphold certain legal duties, which include the following, among others:

• a duty to put the investor’s interests before that of the broker or brokerage firm’s
• a duty to recommend investments only if they are in accordance with an investor’s goals, financial situation, and risk tolerance
• a duty to understand and explain risks of investments that are recommended
• a duty not to misrepresent or omit relevant facts

Because of the nature of this legal relationship, there are many more specific duties that have been outlined by numerous courts. If you believe your broker may have committed a breach of fiduciary duty, contact us now to discuss your securities law case.

If you believe your broker may have acted in a manner that was not in your best interest, and is in breach of fiduciary duty, contact us now for a free consultation. You may be able to recover your losses.