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Find Out if You Should Hire a Churning Attorney to Pursue FINRA Arbitration
If you have noticed excessive and unauthorized trades in your brokerage account, you may have a claim for “churning.” Churning is the practice of using a customer’s brokerage account to rack up fees and commissions at the customer’s expense. It is prohibited under federal securities regulations and the Financial Industry Regulatory Authority’s (FINRA) Rules, and if you are a victim of churning, you can—and should—hire a churning attorney to represent you in FINRA arbitration.
FINRA arbitration provides a forum for investors to pursue fraud claims against their brokers and brokerage firms. This includes claims for churning. At Zamansky LLC, we are committed to using the arbitration process to hold brokers and brokerage firms accountable. If you are entitled to recover your investment losses, a churning attorney at Zamansky LLC can file for arbitration on your behalf and use the available evidence to prove your right to financial compensation.
Understanding the Signs of Churning as a Brokerage Client
If you’re reading this, you likely have suspicions about excessive trading already. You may have concerns for a variety of reasons, and, at this point, all of them warrant further investigation. If your broker has engaged in churning, you need to be able to prove it, and filing a claim promptly can both help to minimize your losses and maximize your chances of a full financial recovery.
When we represent clients in churning cases, we examine our clients’ portfolios and communications with their brokers for several red flags. Some of the most common signs of churning we see include:
- A high volume of securities transactions in a short time period
- Brokers encouraging their clients to sell and realize short-term gains
- Brokers encouraging their clients to take losses in order to invest in similar securities
- Brokers encouraging their clients to sell high-performing securities while ignoring those that are underperforming
- Clients receiving incomplete or misleading information about the fees and commissions associated with particular trades
- Clients’ account statements failing to reflect the total fees and commissions that their brokers have earned at their expense
- Discretionary control of the client’s account being handed over to (or assumed by) the broker
But, it is important to emphasize that these are just examples. If you have concerns about excessive trading in your brokerage account for any reason, you should speak with a churning attorney promptly. In general, if your broker is making trades without your knowledge or consent or if your broker is going against your specific instructions, this should be cause for concern. Your broker should be fully transparent about his or her activities affecting your account, and you should have control over your account at all times. If either of these isn’t the case, you could be a victim of broker fraud.
Why Choose a Churning Attorney at Zamansky LLC?
Lots of law firms advertise that they represent investors in claims against their brokers. So, if you need a churning attorney, why should you choose Zamansky LLC?
We have decades of experience representing clients in claims for churning and other forms of broker fraud. Unfortunately, while broker fraud is illegal and prohibited under FINRA’s Rules, it is also alarmingly common. We understand how broker fraud affects investors, and we are passionate about making sure our clients achieve the outcomes they deserve. Our results speak for themselves, and we are proud of the many testimonials we have received from our clients as well.
FAQs: Hiring a Churning Attorney to Pursue FINRA Arbitration
Is it Illegal for Brokers to Engage in Churning?
Yes, churning is illegal. It is prohibited under the federal securities laws that protect investors from fraud. It is also prohibited under FINRA’s Rules, which apply to all registered brokers and brokerage firms in the United States. If you are a victim of churning, you have clear legal rights, and you should speak with an experienced churning attorney promptly.
Why Do Brokers Engage in Churning?
Churning a client’s broker account serves one purpose: It generates fees and commissions for the broker. It does not help maximize the client’s returns, and in fact, in many cases, it leads to substantial investor losses. Since churning is illegal, it is an extremely high-risk practice, and it is often perpetrated by unscrupulous and desperate brokers who are willing to do anything to generate income for themselves.
What Are My Legal Rights as a Victim of Churning?
If your broker has churned your account (or if your broker is actively churning your account), you have the right to recover your fraudulent losses in FINRA arbitration. All brokers consent to arbitration as a condition of registration. Your churning attorney can handle your arbitration claim for you and can make sure that you are seeking the full damages to which you are legally entitled.
If I Am a Victim of Churning, Do I Need to Take My Broker to Court?
No. While going to court is one option, in most cases, it is in investors’ best interests to pursue FINRA arbitration. The arbitration process is both faster and less expensive than going to court, and FINRA arbitrators are experts in all forms of broker fraud. When you hire a churning attorney at Zamansky LLC, your attorney will help you make an informed decision about how to assert your legal rights, and then your attorney will fight to recover your fraudulent investment losses on your behalf.
How Do I File a Churning Claim Against My Broker?
If you believe that you have a churning claim against your broker, your next step is to schedule a free consultation with an attorney who handles these types of claims. At Zamansky LLC, we focus our practice exclusively on representing defrauded investors, and we can use our experience to pursue your churning claim as efficiently and effectively as possible.
Speak with a Churning Attorney at Zamansky LLC in Confidence
Do you have a churning claim against your broker? To discuss your legal rights with an experienced churning attorney at Zamansky LLC in confidence, call 212-742-1414 or request your free initial consultation online now.