Securities Arbitration

Types of Claims

Misrepresentations and Omissions

Investors have rights when they are the victims of misleading communications from their brokers and brokerage firms.  Federal and state laws impose strict duties on brokers and brokerage firms to not misrepresent or omit material information in written and oral communications with their clients.  Information is material when it is important to an investor’s decision. 

Misrepresentations are inaccurate communications of material information.  Brokers and firms misrepresent information when they tell you something incorrect about investment strategies and products, like risks or costs.  Misrepresentations may also occur when a broker or firm communicates information that, while true, is so one-sided and unbalanced that it is misleading.  Failing to communicate material information is an omission.  Examples of omissions that may cause investors’ losses include failing to disclose firm or broker conflicts of interest or the risks or costs associated with an investment strategy or product.

When brokers or firms intentionally misrepresent or omit material information, they have committed serious fraudulent acts that can form the basis of claims to recover investors’ losses.  Such fraud may even constitute a criminal act.  On the other hand, when misrepresentations or omissions are not intentional, brokers or firms have acted negligently.  Such negligence may also violate laws and be the basis of claims to recover investors’ losses.

Claims for misrepresentations and omissions are important types of claims to recover investment losses.  Contact Marquardt Law Office LLC for a free evaluation if you believe you have suffered losses due to your broker or brokerage firm’s misleading communications.