Representing Investors Whose Financial Advisors Prioritized Their Brokerage Firm’s Financial Interests When Making Investment Recommendations

Shepherd Smith Edwards and Kantas features dedicated Regulation Best Interest Investor Lawyers who represent clients when financial advisors prioritize firm profits over investor interests. Operating out of their Buffalo office, these New York attorneys help victims of SEC rule violations pursue financial recovery through FINRA arbitration claims.

At Shepherd Smith Edwards and Kantas (investorlawyers.com), we represent New York investors who suffered serious losses after their financial advisor violated Securities and Exchange Commission (SEC) Regulation Best Interest (Reg BI). This rule, which has been in effect since the end of June 2020, prohibits brokers from placing their own financial interests over the interests of their customers when working with them.

Unfortunately, there are financial advisors who don’t abide by this rule, and that continues to cause significant investor losses. This has led to a slew of regulatory lawsuits and FINRA arbitration claims against registered representatives and their firms.

From our Buffalo, NY securities law office, our New York Reg BI lawyers are here to help.

What Are the Core Obligations of SEC Regulation Best Interest?

Care: A financial advisor has to exercise reasonable due diligence, care, and skill to make sure they understand any investment-related recommendation they make, including the risks and rewards. They also must ensure that the recommendation is appropriate for the customer without disregarding comparable, less costly options.

Disclosure: There must be written disclosure of all material facts, the terms of the broker-customer relationship, any conflicts, and all fees and costs. This must be provided to a customer before or when an investment-related recommendation is made.

Conflicts of Interest: Brokerage firms must put into place, maintain, and enforce written procedures so as to identify, eliminate, and/or mitigate conflicts of interest.

Compliance: There must be written policies and procedures that can allow a brokerage firm and its registered representatives to comply with Regulation Best Interest.

What Are Some of the Ways That Brokers Have Been Known To Violate Reg BI?

• Excessive mutual fund switching, which can trigger upfront sales charges without financial benefit to a New York investor.
• Not exploring other investment recommendations that are less costly but just as beneficial to a customer.
• Supervisory failures that leave an investor’s portfolio vulnerable to changing market conditions. This can lead to overconcentration or leaving a customer in an investment that has gone bad.
• Selling illiquid, risky alternative investments to retail investors and conservative retirees because of the high commissions and fees that the broker can earn.
• Excessive trading, which is also known as churning, in a customer’s account in order to generate commissions.
• Not disclosing conflicts of interest for why a broker might sell a product to a customer even if it doesn’t serve the latter’s financial interests.
• Unsuitable investment recommendations in leveraged or speculative products that are not a fit for the investor’s financial goals. Meanwhile, the broker ends up making a lot of money from the sales.
• An unnecessary account rollover that benefits the brokerage firm but not the customer.
• Downplaying a proposed investment strategy’s high risks to get the client to say yes.

A financial advisor can make an investment recommendation that may satisfy FINRA’s suitability rule yet still fail to meet SEC Regulation Best Interest’s requirements.

I’m A New York Investor. What Should I Do If I Suffered Losses Because My Broker Ignored My Best Interests?

The best way to know for sure whether you were the victim of SEC Reg BI violations is to contact our Buffalo, NY securities law firm to request your free case consultation. There also may be other legal grounds for filing an investor lawsuit against your financial advisor.

If you do have a securities claim on your hands, you will have to file a Statement of Claim in FINRA arbitration. This is not the same as going to court. You want experienced NY Regulation Best Interest lawyers representing you regardless of whether you are attempting to sue a large Wall Street firm or a regional broker-dealer in New York or from another US state.

Representing Investors With Regulation Best Interest Loss Lawsuits

• Shepherd Smith Edwards and Kantas has been fighting for investors for more than 35 years.
• We have secured a collective many millions of dollars for thousands of US investors.
• When you work with us, you are hiring everyone at our New York securities law firm to represent you.

Discuss Your New York Reg Best Interest Investor Concerns With Us Today:

Call our Regulation Best Interest Investor Lawyers at (716) 261-3529 or (800) 259-9010 or reach out to us here.

Sheridan Meadows Corporate Park South
6225 Sheridan Dr #308-B
Buffalo, NY 14221