Holding Investment Advisors Accountable For Misrepresentations And Omissions

Financial professionals have a strict legal obligation to be completely honest and thorough when recommending investment opportunities. When they fall short of this duty, investors can suffer devastating financial harm. Unfortunately, many individuals do not realize that their losses were actually caused by an advisor who withheld critical facts or provided dishonest summaries of an investment’s true nature.

If you lost a significant portion of your savings because a financial professional misled you, you may have grounds to file an investment advisor fraud claim. LewinsLaw, P.C., helps individuals expose deceptive advisory practices and pursues full investor loss recovery through the established arbitration process.

The Critical Difference Between Misrepresentations And Omissions

To build a successful recovery claim, it helps to understand the two distinct ways a financial professional can breach their duty of honesty:

• Misrepresentations (active deception): This occurs when an advisor actively provides false information or overstates the positive aspects of an investment. Examples include telling an investor that a product carries zero risk, falsely claiming a company is financially stable when it is facing bankruptcy or guaranteeing a specific percentage return.
• Omissions (passive deception): This occurs when an advisor remains silent about critical facts that would cause a reasonable investor to think twice about an opportunity. Even if every statement the financial advisor makes is technically true, failing to disclose underlying risks, high fee structures or liquidity restrictions constitutes a harmful omission.

Both practices distort the truth, leaving investors unable to make informed decisions about their money. If you suspect your advisor used these tactics, a dedicated financial advisor negligence attorney can review your account communications to uncover where the truth was altered or hidden.

Work With A Financial Advisor-Turned Attorney

Proving that an advisor lied or withheld facts requires a deep understanding of compliance rules and internal brokerage paperwork. Founded in May 2009, LewinsLaw, P.C., focuses exclusively on investor protection. The firm is led by Richard A. Lewins, a financial advisor misconduct attorney admitted to the bar in 1995, who brings over three decades of legal experience to every case.

Before becoming a securities fraud lawyer, Mr. Lewins spent years working inside the financial sector as an advisor and manager for major national firms, including EF Hutton, Merrill Lynch, Shearson Lehman and HD Vest. He also held Series 7 and 24 licenses. Having seen firsthand how brokerage firms construct sales presentations and sometimes minimize risks to push products, he transitioned to securities law to defend defrauded investors. Operating out of Dallas, Texas, and serving clients nationwide, he uses this insider knowledge to spot the exact moments where an advisor crossed the line into deception.

Common Misrepresentation And Omission Scenarios

Financial advisors use various methods to hide the realities of high-risk products. The firm frequently investigates claims involving:

• Downplaying substantial investment risks: Assuring a conservative investor or retiree that a complex product is safe, while failing to disclose that the principal investment could be completely lost.
• Concealing fee structures and costs: Failing to disclose high upfront sales commissions, surrender charges or ongoing management fees that erode the investor’s returns.
• Unsuitable product matching: Selling long-term illiquid investments – such as certain private placements or nontraded alternative products – or unsuitable mutual funds with high surrender charges to elderly investors who need immediate access to their funds, while omitting the fact that the money will be locked away for years.
• Selling away: Recommending and selling investments that are not approved or vetted by the financial advisor’s executing firm while hiding the unauthorized nature of the transaction.
• False performance guarantees: Assuring investors that a product cannot lose money or promising a specific dividend payout that the advisor knows is unsustainable.

Mr. Lewins understands from firsthand experience the pressures and mindset of investment advisors. This enables him to spot inappropriate financial advisor behavior quickly.

Answers To Common Misrepresentations And Omissions Questions

After having your finances threatened by active or passive dishonesty, it’s time to find the truth. Mr. Lewins has answered several common questions he hears frequently when clients visit his office.

Do I have to prove the financial advisor intentionally lied to win a claim?

No. While intentional fraud is a serious violation, an investor can also recover losses based on negligent misrepresentation. If an advisor failed to perform proper research and carelessly passed along false information without verifying it, they can still be held liable for the resulting financial damage.

What documents are needed to support a misrepresentation claim?

Crucial evidence includes written emails, text messages, marketing brochures, prospectuses and monthly account statements. Comparing what the advisor told you in writing or conversation against the actual risk disclosures in the official product paperwork is a key component of building a case.

How does the firm handle attorney fees for investor recovery cases?

Mr. Lewins represents defrauded investors nationwide primarily on a contingency basis. Clients do not pay upfront hourly legal fees..

Fight Back With LewinsLaw, P.C.

You should not have to absorb the financial losses caused by professional investor misconduct. Put an attorney on your side who knows the industry from the inside. Contact the firm today at 972-893-9245 or complete the online contact form to schedule your confidential consultation.