The seriousness of allegations against a financial advisor can’t be understated, particularly when it involves a breach of fiduciary duty, negligence, and negligent misrepresentation. These allegations are currently being investigated against Linda Wimsatt of WESTPARK CAPITAL, INC. and AMERICAN TRUST INVESTMENT SERVICES, INC. The case, numbered 23-02395, was filed on 9/21/2023, and is currently pending. The customer dispute alleges that activities occurred which led to a loss of $40,000 due to breach of contract, failure to supervise, and violation of Regulation Best Interest (Reg BI).
Understanding the Allegations and the FINRA Rule
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In simple terms, a breach of fiduciary duty refers to an advisor failing to act in the best interest of their client. Negligence, on the other hand, occurs when an advisor fails to exercise the care that a reasonably prudent person would exercise in the same situation. Negligent misrepresentation refers to a situation where an advisor, without any direct intention to deceive, makes false statements that cause financial harm to a client.
Reg BI is a rule set by the Financial Industry Regulatory Authority (FINRA), which requires brokers to act in the best interest of their clients when making a recommendation of any securities transaction or investment strategy. Failure to abide by this rule, as alleged in this case, can lead to significant penalties.
The Importance of this Case for Investors
This case is significant for investors as it highlights the potential risks involved when dealing with financial advisors. It underscores the importance of trust and transparency in the advisor-client relationship. It also serves as a reminder that investors have rights and can take legal action if they believe they have been wronged.
Investors should know that they can recover losses through FINRA Arbitration, a process designed to resolve disputes between investors and their brokers or brokerage firms. Haselkorn & Thibaut, a national investment fraud law firm with offices in Florida, New York, North Carolina, Arizona, and Texas, is currently investigating this case. With over 50 years of experience and an impressive 98% success rate, they offer free consultations to clients and operate on a “No Recovery, No Fee” policy.
Spotting Red Flags and Recovering Losses
Investors should be vigilant for red flags that may indicate malpractice by a financial advisor. These can include frequent trading to generate commissions, unsuitable investment recommendations, and failure to disclose important information. If an investor suspects that their advisor has engaged in any of these activities, they should consider seeking legal help.
Investors who have suffered financial losses due to the actions of their financial advisor can recover their losses through FINRA Arbitration. Haselkorn & Thibaut specializes in this area and has a proven track record of successful financial recoveries for investors. They can be reached toll-free at 1-800-856-3352 for a free consultation.
