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Regulation Violations

Violations of Industry Regulations

At the Investment Loss Recovery Group, we have we know how to work with regulators to help investors recover losses. Our attorneys are former licensed securities brokers and defense attorneys for major Wall Street broker dealer firms, who understand the intricacies of the rules and regulations that govern investments.

Financial regulations can be complex and daunting, but we can help you navigate the rules and recover for losses caused by violations. With nearly 40 years of experience handing investor losses, we know the laws and regulations that can help you recover your losses.

The Investment Loss Recovery Group offers the services and resources of a big firm with the dedication and attention of a smaller boutique firm. We’ve worked with firm policies, industry rules, and laws across the industry to help our clients. Our efforts have resulted in the recovery of millions of dollars on behalf of our clients from some of the largest Wall Street firms.

We work with each client to understand the facts of their case and to develop a tailored strategy for them. We’re dedicated to recovery for investors who have been harmed by violations of financial industry regulations.

If you suspect your broker or firm has violated their legal obligations, we can help. Contact us today for a free consultation.

Violations of Industry Regulations

The Financial Industry Regulatory Authority (FINRA) is an industry organization empowered to issue regulations on investments. FINRA’s goal is to boost confidence in investment markets by creating sensible rules and enforcing them. They also assist markets by handling and resolving disputes between parties. FINRA works with other industry-wide organizations and government organizations to investigate and eliminate rule violations.

FINRA is an important source of recovery and restitution in the financial industry. In one recent year, FINRA initiated 1,434 disciplinary actions against members and firms, fined them $176.3 million, and delivered $27.9 million in restitution to investors.

FINRA has broad powers in the financial and investment industry. All brokers in the industry must be licensed by FINRA. FINRA can levy fines or bar brokers and others from working in the industry, and formally investigate claims against those working in the financial industry. If an investor files a claim for fraud or negligence against a broker, FINRA will be involved.

Violations of FINRA regulations can result in serious consequences:

  • Fines. FINRA can levy serious fines against brokers and firms. In a recent case, FINRA fined a firm nearly $1 million for failing to oversee one of their broker’s behavior. The behavior was fraudulent and resulted in large losses for an elderly investor.
  • Suspension or barring from the financial industry. In another case. FINRA found that a firm had charged clients excessively and put markups on their offerings. FINRA expelled the entire firm from the industry and fined it $1 million.

Violations of Firm Policies

Firm policies are another important part of the enforcement puzzle. Policies help protect investors and set clear rules for brokers to follow. Firms are often required to develop policies by FINRA and the SEC.

When adequate firm policies are in place, it’s easier for firms to identify and prevent problems with their brokers. When an individual violates a firm’s policies, the firm may suspend or terminate the individual’s employment.

Most firms are ethical and law-abiding organizations that want to help their clients. They also want to keep their business clear of unethical or illegal activity. If they don’t, FINRA could punish the entire firm because of one employee’s illegal behavior.

Violations of State & Federal Law

Violation of industry standards and firm policies can bring severe penalties on individuals and firms. FINRA can levy major fines and permanently bar someone from operating in the financial industry. Firms can suspend and terminate employees. While FINRA and firm rules are both important parts of the enforcement scheme, the government can take things a step further.

The U.S. Securities and Exchange Commission (SEC), the Department of Justice (DOJ), and many state government organizations can bring actions against firms and individuals. The nature of these actions will depend on the facts of the case and the particular rules that apply. It’s important to note though that the government can bring much more serious consequences to bear on illegal activity.

The government can bring a variety of actions against individuals and firms:

  • Injunctions against future activity. The government can file injunctions against firms and individuals that bar them from taking specific actions in the future. These actions could include forcing firms to change policies and procedures and forcing individuals to cease and desist involvement in certain types of transactions.
  • Civil actions. The SEC has broad powers to bring civil actions against individuals and firms engaged in illegal behavior The SEC can bar firms and individuals from involvement in the financial industry, they can levy severe fines, and they can force individuals and firms to disgorge profits that they’ve made from illegal activity.
  • Criminal charges and prison time. In addition to civil actions, individuals and firms can face criminal charges. In cases where a firm or individual’s conduct rises to the level of criminality, the SEC can cooperate with the DOJ to pursue criminal charges. The SEC will provide the DOJ with any information and resources available to prosecute those accused of fraud and other illegal activities. Prison terms can be significant: for example, Bernie Madoff, who was convicted of running an enormous Ponzi scheme in 2009 was convicted and sentenced to 150 years in prison.

Industry Regulations, Policies, and Laws: A Lawyer Can Help

Investment recovery is a complex and time-consuming task. With so many rules governing the process, recovery can seem overwhelming.

The Investment Loss Recovery Group knows the ins and outs of how to help you recover. We’ve handled cases involving investment fraud and negligence to more complex rules violations. If your firm or broker has violated the rules and harmed you, we want to help you recover your losses. No matter the size of the investment or the scope of the loss, we can help you investigate and plan your next steps.

The attorneys at the Investment Loss Recovery Group have the knowledge and experience to help you recover. As former licensed securities brokers and defense lawyers, we understand the policies, rules, and regulations that apply. We know how the financial industry operates and how to anticipate and counter their defenses.

If your investments have been harmed by rule violations, find out how we can help you. Contact us today for a free consultation and review of your best legal options.