The Federal Trade Commission (FTC) reports that Americans lose billions of dollars to fraud every year. Investment fraud accounts for one of the largest shares by dollar amount. In the civil context, lawyers for fraud represent victims pursuing recovery. Not defendants facing criminal charges.
Most cases involve brokers, financial advisors, or fraudulent schemes. They’re typically resolved through civil court, FINRA arbitration, or regulatory channels.
Determining If You’re Eligible for an Investment Fraud Cause
Investment fraud takes many forms, but the common thread is the same: money that should be growing or protected gets misused or stolen. Most cases fall into a few categories.
Broker Misconduct
This is the most frequent category of investment fraud. Unauthorized trading, churning, and unsuitable investments are all actionable. So is breach of fiduciary duty by a financial advisor.
Ponzi and Pyramid Schemes
In a Ponzi or pyramid scheme, returns paid to existing investors come from new investor money. Profits aren’t legitimate, so Ponzi schemes collapse when new money slows.
Advisor or Planner Fraud
The advisor or planner stole funds, forged signatures, or hid conflicts of interest.
Pump-and-Dump and Microcap Fraud
Promoters artificially inflate the price of a low-volume stock. Then, they sell at the peak, leaving regular investors holding worthless shares.
Affinity Fraud and Elder Financial Exploitation
Fraudsters often target tight-knit communities by exploiting trust. Examples include religious groups, ethnic communities, and retirees. Older adults are particularly vulnerable.
Our investment fraud attorneys handle each of these case types. Book a free case review to learn what may apply to you.
What Lawyers for Fraud Do and When You May Need One
Investment fraud cases aren’t like a typical contract dispute. Recovery depends on identifying the best legal theory, defendants, and forum.
- A fraud lawyer investigates your losses. They review account statements, trade confirmations, contracts, and communications to figure out exactly what happened. What resembles investment loss may actually be unsuitable advice or unauthorized trading.
- Then, they identify every responsible party. The advisor or broker who pulled the trigger may not be the only defendant. The brokerage firm, the financial institution, the issuer of the investment, and even outside professionals could be liable. The right defendants determine whether you actually recover anything.
- They select the right forum for legal action. This could be civil court, FINRA arbitration, or regulatory complaints. Each path has different rules, different timelines, and different remedies.
- A fraud lawyer negotiates or litigates. Some cases settle once the other side sees the evidence. Others require full arbitration or trial. Your lawyer should be ready for both, especially complex litigation.
You typically need an investment fraud lawyer as soon as you reasonably suspect something is wrong. Statutes of limitation can run quickly, and some recovery options expire even faster.
Accountability and Justice in Investment Fraud Cases
Most investment fraud victims don’t realize how many options they have for recovery. Your options depend on who you trusted with your money and your investments. The right combination depends on the case. Many people pursue more than one channel at the same time.
FINRA Arbitration
When a registered broker or brokerage firm is involved, disputes typically go through arbitration. The Financial Industry Regulatory Authority (FINRA) administers the process. FINRA is the self-regulatory organization that oversees broker-dealers. It runs the dispute resolution forum where most broker misconduct claims are filed.
Civil Lawsuits
What if the bad actor wasn’t a registered broker? They may have been a fraudulent investment promoter, a Ponzi operator, or a corporate insider. If that’s the case, then recovery happens in civil court.
Civil suits can include claims under federal and state securities laws or common-law fraud. Another option is breach of fiduciary duty.
Regulatory Complaints
Your attorney could file complaints with the SEC, state securities regulators, or the FBI on your behalf. These complaints can trigger investigations, freeze assets, and create receiverships that distribute recovered funds. They also create a public record that supports civil litigation. However, regulatory complaints may not result in direct recovery for individual victims.
Why Acting Quickly is Critical in Investment Fraud Cases
Investment fraud cases live and die on timelines most victims don’t know exist.
- Statutes of limitation, including both federal and state deadlines. Federal securities fraud claims under Rule 10b-5 generally must be filed within two years of discovery, and no more than five years after the violation, per 28 U.S.C. § 1658(b). FINRA arbitration claims have a six-year eligibility window under FINRA Rule 12206.
- Preserving evidence like account statements, emails, recorded calls, and trade records. Brokerage firms have document retention rules that may purge older files. Acting quickly preserves the records you may need.
- Freeze or preserve assets, because fraudsters often spend or hide stolen funds.
- Comply with regulatory windows. Some regulators have shorter complaint windows than civil courts. Filing early protects your rights across the board.
Our attorneys handle investment fraud cases nationwide. We move quickly to lock down the timeline on every case we take.
Frequently Asked Questions About Investment Fraud Lawyers
Do I need to hire lawyers for fraud, or can I just report to the SEC myself?
Yes, you could file a complaint with the SEC, but there is a catch. Those complaints rarely produce direct compensation for individuals. Civil litigation or FINRA arbitration is typically how people recover money. Legal counsel protects those claims for success.
What kinds of cases do investment fraud attorneys handle?
Investment fraud attorneys handle broker misconduct, like unauthorized trading, churning, and unsuitability. Other examples include advisor fraud, pyramid schemes, securities fraud, and elder financial exploitation.
How long do I have to sue after discovering investment fraud?
Federal securities fraud claims generally have a two-year window from discovery. There is a five-year statute of repose from the violation. State and FINRA arbitration deadlines vary. Meet with an attorney to learn what may apply to you and your case.
What does it cost to hire lawyers for fraud?
Most investment fraud attorneys work on a contingency fee basis. Alexander Shunnarah Trial Attorneys works on this agreement. You pay nothing up front. Instead, you only pay if we win a settlement or verdict for you.
What evidence do I need to bring to an investment fraud attorney?
Evidence is the difference between a strong and weak case. Different types of evidence include account statements, contracts, written communications, and a timeline of events. Bring everything you have to your first meeting. A fraud lawyer will identify additional records to subpoena.
Trust Our Attorneys for Investment Fraud Today
We’ve spent decades fighting for everyday people against opponents with deeper pockets. Investment fraud cases are no different, but the wrongdoers wear suits, and the losses can be life-changing.
Alexander Shunnarah Trial Attorneys has recovered over $2 billion for more than 250,000 clients. We are headquartered in Birmingham, Alabama, with offices nationwide. Imagine what our law firm could do for you. Schedule a free consultation today.
