Financial Advisor Complaints

Your financial advisor, and his or her firm, is regulated by the Financial Industry Regulatory Authority (FINRA). You can file an official complaint about your financial advisor with FINRA or other relevant state or federal regulatory agencies.

Please note that FINRA’s complaint process is regulatory, not compensatory. FINRA may discipline your financial advisor, but FINRA says it cannot assure any compensation for lost funds. If you are seeking recovery of money, FINRA suggests that you contact a specialized securities attorney.

If you want to see if any complaints have already been filed against your financial or investment advisor, you can utilize FINRA’s BrokerCheck program. This program provides you with information about your advisor’s firm, credentials, qualifications, complaint record, and disciplinary history. FINRA also provides a Disciplinary Actions Online database for advisors subjected to disciplinary action after 2005.

The SEC also has a tool to gain information on your investment advisor. You can use it to view your advisor’s background, professional conduct, current registrations, and disclosures about disciplinary activity. Visit the Investment Advisor Public Disclosure website for more information.

Complaints against financial advisors are not uncommon. According to Commercial Trial Law, there are over 5000 cases filed against financial advisors with FINRA every year, with even more complaints filed outside of the FINRA process.

Investopedia claims that typical financial advisor complaints include providing inadequate information about investments, selling just to earn commission, slow response times, churning, and giving unreasonable promises or guarantees. According to one of the many dissatisfied customer reviews for J.P. Morgan Chase financial advisors

All they do is steer you into high fee, low return and losing investments and then leave you hanging when you complain about losses. The advisor who was calling and emailing you every day before you signed up is conveniently “very busy”, “sick and not feeling well” and will “try to fit you in” after they have gotten your money and their fees for selling bad investments.

Investors should be aware of the different types of advisor misconduct and fraud and proceed with caution when investing. If you are subjected to financial advisor misconduct, you have the right to pursue a complaint through FINRA or a lawsuit. Contact our securities lawyers today to learn more about your options.

Most people use the terms “financial advisor” and “investment advisor” interchangeably. But there is actually a difference. Investment advisors are often held to a higher standard than financial advisors.

Investment Advisor

“Investment advisor” is a legal term describing individuals regulated by the Securities and Exchange Commission (SEC) or state regulators. Investment advisors are held to high standards, including having to pass certain FINRA Series exams in order to gain specific licenses.

Investment Advisors are generally held to the standards of a “fiduciary.” This means that they hold a special relationship of trust with their clients and are obligated to work solely in the client’s best interest.

Financial Advisor

Unlike the term “investment advisor,” there is no legal definition for the term “financial advisor,” according to FINRA. Financial advisor describes a wide variety of professionals, usually stock brokers. These professionals are not all necessarily required to be licensed to call themselves advisors. Generally, however, financial advisors who specialize in a certain financial practices, such as buying and selling stocks, are required to hold specific licenses.

Since the term refers to a broad category of individuals, financial advisors can have many different types of training and experience. This means that some financial advisors are held to higher standards than others. According to Forbes,

You can call yourself a financial advisor without having any specialized education, training or expertise.

Additionally, not all “financial advisors” are held to the same standards of a “fiduciary” as “investment advisors.” This means that some financial advisors are not obligated to work solely in their client’s best interest. For more information on fiduciary standards, visit out Financial Advisor Fraud page.

If you think your financial advisor took advantage of you or a family member, there are steps you can immediately take to fight back:

1. Don’t delay
   Every legal claim has a certain amount of time in which you must file a lawsuit (known as a “statute of limitations”). If you don’t act within that time period, you may lose your ability to sue your investment advisor. Sometimes when investors discover that they have been defrauded, they feel embarrassed and ashamed; this can paralyze people and prevent them from seeking help or taking quick action. Reacting rapidly when you discover a possible fraud is incredibly important because the passage of time may affect your rights.
2. Gather your documents
   Financial statements, stock trades, customer agreements, emails, and other correspondence with your financial advisor could be relevant and useful. However, if don’t have immediate access to all records that are relevant to your case, we are still happy to consult with you.
3. Consult with an experienced financial fraud lawyer
   Our skilled financial fraud lawyers can conduct an account audit to determine the full extent of your damages and determine whether misconduct occurred. Investment or financial advisors who commit one type of fraud or scam often don’t stop there — understanding the full extent of the harm is critical to determining how best to proceed.

Some investors are concerned about the prospect of paying an hourly rate or having to pay out-of-pocket in advance for legal representation to sue their financial advisor. We represent our clients on a contingency or “success-fee” basis, which means that if you win the case, the lawyer’s fee comes out of the money awarded to you. If you lose, you will not be required to pay your attorney for the work done on the case.

We are happy to discuss any questions related to our fees as well as different arrangements we can structure.

Scott Silver

Scott focuses his law practice on securities arbitration and litigation and plaintiff-side class action litigation, representing individual investors and institutions in claims against brokerage firms, investment advisors, commodities firms, hedge funds and others.

Eileen Epstein Carney

Eileen is involved in the firm’s securities practice and has over a decade of experience in the legal world. She received her law degree from American University in 2005.

Dave Stein

David’s advocacy has generated major recoveries for consumers impacted by financial fraud. He was named to the Top 40 Under 40 by Daily Journal and a “Rising Star in Class Actions” by Law360.

Amanda Karl

Amanda is spearheading a securities lawsuit against NantHealth concerning fraudulent statements to investors about the success of its key product.