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Is my Financial Advisor Responsible for Losses in my Retirement Acct?

By Olivia Fitzgerald on November 04, 2018

Throughout our years of representing investors we’ve noticed one common denominator among investors who’ve lost money in a market that experienced nearly constant upward growth—their accounts were chuck full of risky, speculative and unsuitable investments recommended to them by their Financial Advisor. Put differently, in almost every case where we compared the performance of the client’s account to the performance of a simple, diversified portfolio, such as the spider ETF (S&P 500 ETF (SPY)), the client’s account performed significantly worse than a properly diversified portfolio performed during the same time period. And in every one of those cases, the accounts were wholly at odds with the investor’s needs and investment objectives.

Financial Advisors have a legal duty when recommending or enacting the purchase, sale, or exchange of any security to only recommend suitable investments. Being able to convince an investor to approve a certain recommendation does not make the recommendation suitable.

As the SEC has repeatedly explained, “Even if we concluded that a customer understood their advisor’s recommendations and decided to follow them, that would not relieve them of his or her obligation to make reasonable recommendations. The test for whether an advisor’s recommended investments were suitable is not whether or not the customer acquiesced in them, but whether the advisor's recommendations to them were consistent with his or her financial situation and needs.”

Therefore, if you lost money as a result of the securities that were recommended to you by your financial advisor, you may have a legal claim/basis for recovery.

Olivia Fitzgerald is an attorney at Halling and Cayo, a full service law firm in Milwaukee, WI and part of its Securities Litigation team.  She focuses her practice on business and securities litigation..  Contact her at 414-271-3400 or via e-mail at OF@hallingcayo.com to see if she can help recover funds.  

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Milwaukee Office

320 E Buffalo St
Ste 611
Milwaukee, WI 53202

Open Today 8:00am - 5:00pm

Open Saturday and Sunday for calls and emails.

More Info Directions (414) 755-5020