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What Evidence Do You Need to Sue Your Financial Advisor?

If your financial advisor fails to perform their professional duties, you have the right to sue them to recoup your losses. In order to win your case, however, you must present evidence that proves your claims. Otherwise, the judge (or arbitrator) might not be able to rule in you. That brings us to a very important question … what evidence do you need to sue your financial advisor and win? Here’s a look at what you need to know.

Top Reasons to Sue Your Financial Advisor

When you hire a financial advisor, they must look out for your best interests above all else. There are many ways they can fail to properly guide and represent you, such as:

  • Breach of Fiduciary Duty: Under U.S. securities laws, certain financial professionals must always put your best interests ahead of their own. If they do not, then they may have committed a breach of fiduciary duty, especially if their actions resulted in monetary losses for you.
  • Unsuitable Sale – FINRA Rule 2111 lists the three main suitability obligations for firms and associated persons.
    • Reasonable-basis suitability requires a broker to have a reasonable basis to believe, based on reasonable diligence, that the recommendation is suitable for at least some investors.  Reasonable diligence must provide the firm or associated person with an understanding of the potential risks and rewards of the recommended security or strategy.
    • Customer-specific suitability requires that a broker, based on a particular customer’s investment profile, has a reasonable basis to believe that the recommendation is suitable for that customer. The broker must attempt to obtain and analyze a broad array of customer-specific factors to support this determination.
    • Quantitative suitability requires a broker with actual or de facto control over a customer’s account to have a reasonable basis for believing that a series of recommended transactions, even if suitable when viewed in isolation, is not excessive and unsuitable for the customer when taken together in light of the customer’s investment profile.
  • Unauthorized Trading: Your investment advisor must only perform transactions under your account with your knowledge or permission. Otherwise, they’ve committed unauthorized trading, which makes them fully responsible for any losses that you incur.

Beyond these three areas, financial advisors must always act in good faith in helping you manage your accounts. If they commit any negligent or fraudulent actions, then they are potentially responsible for your losses. In order to recoup those losses, you must work with a full-service litigation law firm to sue your financial advisor in court.

Types of Evidence That Will Back Up Your Claims

In order to fully recover your losses, you must prove that your financial advisor was negligent, committed fraud, or otherwise acted in bad faith. Beyond that, you must show that their actions resulted in your monetary losses. That’s quite a tall order indeed since many agreements occur in person or over the phone, leaving you without a clear record of what occurred.
Without evidence, the financial advisor can simply blame you, the market conditions, or just deny your claims outright. It’s even common for large financial firms to use tricky tactics that prevent the court from discussing the case in an open and fair manner.
In the end, it’s your responsibility to prove beyond a shadow of a doubt that your financial advisor acted in an illegal or unethical manner. The judge cannot just take your word for it.
So, you’ll need to come up with documents, witnesses, and other tangible pieces of evidence that demonstrate their fraudulent and negligent actions occurred. Then, you’ll need to provide investment and bank account statements that clearly show your losses and link them back to the financial advisor’s actions.
Since you never know if your financial advisor might steer you wrong in the future, be sure to always keep all documents they provide in a safe place. That makes it much easier to collect all this evidence for review by the court. Also, keep your bank and investment account statements on hand, so you don’t have to request them if you end up having to find sue financial advisor evidence.

How to Collect Evidence Against Your Financial Advisor

To gather the right amount and type of evidence against your financial advisor, you need help from an experienced law firm. They know where to look for evidence that will show your advisor failed to perform their required duties.
Your lawyer can then use that evidence to build a strong case against the advisor before filing with the court. They’ll also help you gather the evidence needed to show your total losses that occurred due to your financial advisor’s negligence or fraudulent activities.
All you have to do is let them know what happened, who you worked with, and where your losses occurred. Your lawyer will use their experience to determine which laws were broken, if any, and if your financial advisor operated in an unethical manner.

Need Help with Sue Financial Advisor Evidence Collection?

To effectively sue a financial advisor for your losses, you need to partner with our team at The Schwartz Law Firm. Our team can help you figure out if your financial advisor failed to perform their duties, and then assist in tracking down all the evidence you need to prove your case.
With a call to 813-226-3372, you can set up a free consultation to discuss your situation and learn what to expect if your case goes to court. If we take on your case, our team will operate on a contingency fee basis, so you don’t have to pay anything unless we help you recover your losses.

Matthew Schwartz

Matthew Schwartz is a Shareholder at Schwartz, P.A. where he serves as the practice group leader for their securities litigation and professional negligence practice group. His practice is focused on plaintiff-side securities arbitration and litigation, representing individual investors and institutions in claims against brokerage firms, investment advisors, commodities firms, hedge funds and others. He also represents plaintiffs who have been damaged by their insurance agents, lawyers, accountants and other professionals. He is an accomplished commercial litigator who has handled a variety of business disputes and other consumer claims.

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