Broker-Dealer Fraud Lawyers

When High Returns May Be A Sign of Investment Fraud

Our Trusted Broker-Dealer Fraud Lawyers Help Investors To Recoup Their Losses

It can be exciting to make good money from investing, and high returns, especially, can be rewarding. However, there are instances when such returns can be a red flag indicating that you may be about to become or already are the victim of an investment scam.

Shepherd Smith Edwards and Kantas team of Broker-Dealer Fraud Lawyers represent investors throughout the United States who have suffered investment fraud losses that involved some type of broker misconduct or negligence. We also work with international investors whose financial advisor was registered with a US-based brokerage firm.

What Are Some Warning Signs That Your High Returns Might Be Too Good to Be True?

  • If the degree of risk involved is on a different level than the return you are being offered, you may want to watch out. Typically, a financial product, alternative investment, or security that could garner you high returns should also come with a certain level of risk. (Also, if this is a high-risk opportunity and you are a conservative investor or an older, retiree, then there is a good chance that this may be an unsuitable investment recommendation for you.)
  • If you are being told that a financial product is “guaranteed” to make you money without there being any risk of loss, you may want to walk away. Any investment will come with some risk, even if it is minimal. A legitimate investment will never promise that you will make money for sure. The SEC describes such promises as a “classic sign of fraud.”
  • Your returns seem unusually high considering the kind of investment you are involved in. Not every kind of investment can make significant returns. So if you notice that comparable investments are not making as much money as you are, you may want to look into why this is the case.
  • If the returns you are making are “overly consistent,” perhaps even going up each month especially when the market is volatile or the economy is down, this too may be an indication that something may be amiss. Even stable investments will at some point render some loss.
  • Your high returns are credited to a “complex” investing strategy that is too complicated to understand let alone explain.

It can be devastating to find out that the money you are making is, in fact, nonexistent. Unfortunately, this has also been known to happen. For example, in Ponzi scams, investors believe they are making “returns” when, in fact, their funds were never invested, the money they are supposedly earning is coming from newer investors, and when the scheme is exposed the victims end up discovering that their higher balances were never real.

When High Returns Turn Into A Broker Negligence Case


Even if your financial advisor was not directly involved in the investment scam that promised you high returns, if they unsuitably recommended this opportunity to you, failed to conduct the proper due diligence to make sure this was a legitimate, safe investment, made misrepresentations and omissions about the risks (even out of ignorance), or were not properly supervised by their broker-dealer that should have sussed out any red flags, you may be able to pursue damages for your losses. Then, of course, there are instances of bad brokers who purposely seek to defraud customers with the ruse of high returns.

How Can Our Knowledgeable Broker-Dealer Fraud Lawyers Help?

Our savvy broker misconduct lawyers have spent over 30 years helping investors from all walks of life to recoup losses they sustained because of the wrongful or careless actions of financial advisors and their registered representatives. Not only can we help you assess whether your investment losses warrant grounds for a broker fraud lawsuit, but also, should we agree together, our team of skilled investment fraud lawyers, legal assistants, consultants, and others will bring over a century’s worth of combined experience in securities law and the securities industry to your case. More than 90% of our clients have received full or partial financial recovery with our help.

Call our team of Broker-Dealer Fraud Lawyers at (800) 259-9010 today.


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