My mother's investment manager had all her money in stocks even though she was retired. I believe it was negligent for him to have her money in such risky holdings since all advice I've ever read was that as one gets near retirement their money should be in less volitile funds. Needless to say, she lost pretty much all her money. Is it possible to sue an investment advisor for negligence? What is generally considered the litmus test for such negligence? Also, is there a time limit on a person taking such action, any statute of limitation?
3 Answers from Attorneys
All claims arising under state or federal law have deadlines, are time sensitive and will be forever barred or lost if not brought within a specified period of time after these events occurred or should have been discovered. Under the federal securities laws, all such claims must be brought within two (2) years from the date of discovery of any such claim, or five (5) years from the date of the occurrence of the events giving rise to the claim(s), whichever is shorter.
Under state law, generally, all claims for common law fraud, breach of fiduciary duty, or other tort claims, must be brought within two (2) years of the date of discovery upon the exercise of reasonable diligence. If you fail to bring your claims within these proscribed times, your claims may be forever lost or time barred. So you need to act quickly.
Also, because the person is an "investment advisor" they may not be subject to the jurisdiction or arbitration before FINRA (the Financial Industry Regulatory Authority), and instead the investment advisory agreement may require submission before the American Arbitration Association (which is often placed in these agreements as a deterent because AAA so so costly).
If you are interested in pursuing this matter, you should contact qualifed counsel, and you may want to contact us or find an attorney at www.piaba.org (the Public Investors Arbitration Bar Association).
I would encourage you to move quickly because claims under the federal and state laws, including negligence,can be barred if not brought timely.
It is not clear what the person that was advising your mom was a broker or an investment adviser. The standards of care vary depending on the answer to that. Brokers just need to reccommend suitable investments, and an investment adviser must put your mom's interest ahead of his or her own. Either way, it does not seem like that was done here.
I focus my practice on securities and commodities law and used to do nationwide defense in arbitration for several "wire house" Fortune 500 companies. I have also continued my studies and am a few credits shy of receiving my L.L.M. (Masters of Law) in financial services law.
I encourage you to contact an attorney before an limitations period runs and bars your claim. You can reach me at email@example.com or (847) 675-1052. Please feel free to check out our website at www.maylawpc.net for more information.
You might have a claim for FINRA arbitration. See my website. You may send me an email with some facts.
Daniel Bakondi, Esq.
The Law Office of Daniel Bakondi, APLC
870 Market Street, Suite 1161
San Francisco CA 94102
IMPORTANT NOTICE: This communication may contain confidential information, privileged information, or attorney work product. If you are not the intended recipient or received this message in error, any use or distribution of this message is strictly prohibited and unlawful. Please notify the sender immediately, and delete this message. No attorney-client nor confidential relationship is created through this communication. Nothing communicated or provided constitutes legal advice nor a legal opinion unless it so specifies and written agreement for attorney services has been entered into. Attorney licensed in California only. Your issue may be time sensitive and may result in loss of rights if you do not act in time. Thank you.
Related Questions & Answers
Format to deligate a lawyer I am looking for form that enables me to deligat a... Asked 4/14/09, 1:36 pm in United States Michigan Investment Law
Online Stock Broker My online stock broker sold a large amount of shares of my... Asked 2/04/08, 4:26 pm in United States Michigan Investment Law
401k Hello: I have a question about so called “round trip” transactions. I have... Asked 2/12/07, 1:39 pm in United States Michigan Investment Law
Can I hold my asset manager liable for loss? Asset manager(AM)recommended margin for... Asked 4/06/05, 1:23 pm in United States Michigan Investment Law
Bad Investment I made a $3K investment with another loan officer on a property. the... Asked 10/31/03, 12:56 pm in United States Michigan Investment Law