24/7 call for a free consultation 212-300-5196




When you’re facing a federal issue, you need an attorney whose going to be available 24/7 to help you get the results and outcome you need. The value of working with the Spodek Law Group is that we treat each and every client like a member of our family.

Securities Fraud Lawyers


Securities Fraud Lawyers: Protecting Investors from Deception

Securities fraud is a big problem that can ruin investors’ lives. As securities fraud lawyers, we see the damage firsthand when companies or individuals manipulate the stock market or provide false information to investors. Our job is to hold fraudsters accountable and fight for our clients to recover their losses.

In this article, we’ll explain what securities fraud is, who commits it, and how a good securities fraud lawyer can help if you are a victim. We know the ins and outs of these complex cases – let us fight on your behalf while you focus on getting your finances back in order.

What Exactly is Securities Fraud?

Securities fraud happens when someone lies to investors or engages in other deceptive practices related to buying or selling stocks, bonds, or other investments. Some common examples include:

  • Accounting fraud – Falsifying financial statements to make a company look more profitable than it really is
  • Insider trading – Company execs trading stocks based on confidential info before it’s public
  • Pump-and-dump schemes – Artificially inflating a stock’s price through false hype, then selling shares before the price crashes
  • Misrepresenting investment risks, terms, or expected returns to investors
  • Churning – Excessive trading through client accounts by brokers seeking commissions

These acts are not just unethical – they are illegal under federal laws like the Securities Exchange Act of 1934 and the Sarbanes-Oxley Act passed in the early 2000s after the Enron and Worldcom scandals. State laws also prohibit securities fraud.

The penalties can be severe – we’re talking massive fines and years in prison. But recovering losses for victims is also a priority for regulators like the SEC.

Who Commits Securities Fraud?

While the image of a greedy Wall Street banker running a complex fraud scheme might come to mind, the reality is securities fraud can be committed by anyone at any level of the financial industry. Common perpetrators include:

  • Company executives – Misrepresenting financials or performance to boost stock price
  • Stock brokers – Making unsuitable investment recommendations to earn commissions
  • Dishonest financial advisors – Putting their own interests ahead of clients
  • Boiler room operations – Call centers using high-pressure sales tactics based on lies
  • Microcap fraudsters – Promoting worthless penny stocks
  • Ponzi ringleaders like Bernie Madoff – Fabricating returns with new investor money

Some scammers even create fake companies or identities to trick investors. With so many ways to profit through lies and deception, securities fraud keeps happening unless these fraudsters fear getting caught and punished.

Warning Signs of Securities Fraud

While scams may seem obvious in hindsight, they can be hard to spot in the moment. Here are some red flags to watch out for:

  • Guaranteed returns – All investments carry risk, so claims of guaranteed profits are usually lies
  • Unsolicited investment pitches – Reputable firms don’t cold call to push stocks
  • Inconsistent statements – Getting different answers from the same firm should raise alarms
  • Lack of documentation – Requests to invest without paperwork should be denied
  • Too complex to understand – Inability to explain an investment simply is problematic
  • High-pressure sales tactics – Reputable advisors give time and space to decide

If something seems off, trust your instincts and walk away or get a second opinion rather than risking money.

How Securities Fraud Lawyers Can Help

If you lost money because of securities fraud, contacting an attorney experienced in these cases is wise. The process of recovering losses can be complex, with strict deadlines for arbitration claims and class action lawsuits.

A knowledgeable lawyer knows the system and exactly what evidence is needed to prove fraud occurred in your case. They can handle collecting documents through discovery and deposing the perpetrators. Building a compelling case requires skills and securities fraud experience many lawyers lack.

The right lawyer advocates aggressively so victims get full and fair compensation. They negotiate firmly with brokers, advisors and their insurance companies who often try to lowball offers. Unlike generalized legal practices, seasoned securities fraud lawyers track case law precedents on getting victims’ money back.

Finally, lawyers allow defrauded investors to relax rather than stress over fighting for the money stolen from them. Litigation can stretch out for years – let your securities fraud attorney handle filings and appearances while you move forward.

Types of Cases We Handle

Our firm assists clients nationwide who lost investments due to all types of securities fraud, including:

  • Churning and excessive trading – Brokers buying and selling stocks in client accounts excessively to generate commissions
  • Misrepresentation of risks – Advisors downplaying risks of investments that later plummeted
  • Unsuitable recommendations – Stocks and bonds incompatible with a client’s timeline or risk tolerance
  • Unauthorized trading – Buying securities without permission in a client’s account
  • Ponzi schemes – Fabricating high returns using new investor money
  • Accounting fraud by public companies – Overstating revenue and assets to appear profitable
  • Microcap fraud – Pumping up penny stocks through false information
  • Options backdating – Falsifying option grant dates to maximize executive profits

No case is too large or too small – we have recovered six and seven figure sums for clients while also taking smaller cases ignored by bigger firms. And we don’t get paid unless we recover money for you.

Steps in a Typical Securities Fraud Case

While each case has unique aspects, the general process typically includes:

1. Reviewing documents – We examine account statements, prospectuses, disclosures, agreements signed with advisors or brokers, and other paperwork to identify misrepresentations or areas where suitable recommendations were not followed.

2. Calculating losses – Using historical statements, we reconstruct what a portfolio would have done if suitable investments were made instead of the fraudulent ones. The difference represents the recoverable losses.

3. Filing arbitration claim or lawsuit – Institutional defendants require arbitration claims to be filed within 6 years. Public company fraud may involve a class action lawsuit.

4. Discovery stage – We utilize interrogatories, document requests and depositions to uncover incriminating details on the fraud.

5. Settlement negotiations or hearing – Many cases settle in mediation before reaching a trial-like arbitration hearing. We fight hard negotiating for maximum compensation.

6. Distribution of award – Awards won at arbitration or from class action settlements get distributed to victims. Complex calculations are often required on determining each person’s share.

While clients don’t have to participate actively, we keep you updated on case progress and seek your input on significant decisions.

Why Choose Us?

With so many lawyers advertising securities fraud services, why choose our firm? Here are key reasons victims of investment fraud consistently pick us to litigate their cases:

  • Decades of experience – Our lawyers have been handling securities cases since the 1990s bull market, through the dot-com crash, the 2008 financial crisis, and recent frauds uncovered after the pandemic dip.
  • Laser focus – Securities litigation is all we do every day. Other firms dabble while handling divorces, personal injury and other unrelated cases.
  • National reach – Unlike small regional practices, our firm serves clients across the country by being licensed nationally and utilizing local counsel.
  • Resources to take on big brokers – Giant wirehouses have deep pockets for legal defense fees aimed at outlasting small plaintiffs firms. We have the staying power to go toe-to-toe for as long as it takes to get clients justice.
  • Successful track record – We have recovered over $100 million for securities fraud victims to date. And past clients are happy to share their positive experiences.
  • We educate – In addition to our blog, we speak at events to raise awareness on protecting investments from fraud. Preventing losses through education is our passion.

If you lost money because of broker misconduct, shady financial advisor practices, or corporate fraud, please reach out for a free consultation. We’ll review your case at no cost and let you know the best options for trying to recover losses.

Fighting securities fraud is what we do every day. With our experienced team advocating for victims like you, companies and scammers learn they can’t get away with misleading investors. Let us help you seek justice today!

Schedule Your Consultation Now