Arizona Securities Fraud Lawyer
Arizona securities fraud lawyers can offer expert guidance for investment loss recovery. If your broker did not accurately characterize the risks associated with particular investments and you suffered losses, consult with an Arizona investment fraud attorney. There are both federal and state securities regulations that are meant to protect you from broker fraud, but you may want expert guidance for the FINRA arbitration process.
Why FINRA Arbitration?
Investor disputes with brokerage firms typically do not go through civil courts. Investors usually sign pre-dispute arbitration clauses as part of their investment contracts. These clauses require investors to settle disputes with brokerage firms through arbitration, a dispute resolution process platformed by the Financial Industry Regulatory Authority (FINRA).
These cases are not best suited to a typical Arizona lawyer. Securities fraud and FINRA arbitration are niche areas and business lawyers are not experts in these types of proceedings.
Arizona Blue Sky Securities Fraud Laws
State statutes are designed to protect investors from securities fraud. Arizona “Blue Sky” state securities law echoes the Federal “Truth in Securities” Act of 1933.
Chapter 44 of the Arizona statutes states that it is unlawful for any person in connection with the sale of securities to do any of the following:
- Employ any device, scheme or artifice to defraud.
- Make any untrue statement of material fact or omit to state any material fact necessary in order to make the statements made, in the light of the circumstances under which they were made, not misleading.
- Engage in any transaction, practice, or course of business that operates or would operate as a fraud or deceit.
It is also unlawful for a person to make an untrue statement of material fact when registering as a broker or filing a prospectus for a security.
Arizona Securities Registration
To ensure compliance with securities rules and regulations, investment professionals must register with the state. Arizona statutes also establish Arizona’s right to revoke or suspend broker licenses.
Broker Registration
Verify any information provided by your broker or investment adviser – like their Broker CRD number – by looking it up on BrokerCheck.org. BrokerCheck is a database maintained by FINRA.
Securities Registration
In addition to broker licenses, Arizona also oversees the registration of securities. Arizona statutes describe the process by which issuers must register their securities. If a securities is exempt under Arizona statutes, the State will issue a no-action letter. Investors can look up no-action letters on the Arizona Corporation Commission website.
Enforcement Actions in Arizona
Arizona regularly revokes licenses in an effort to stop bad actors from engaging in securities fraud.
For instance, Arizona recently revoked investment adviser Pamela Hopman’s license, as well as the license of her advisory firm, PGH Advisors. This followed allegations that she sold $1.5 million worth of securities through a company called Deeproot. Investors allegedly believed they were buying life insurance policies. These securities were allegedly unregistered and the Securities Exchange Commission alleged the company functioned as a Ponzi scheme.
Pamela Hopman’s sole disclosure on her BrokerCheck record comes from Arizona. The State ordered her to repay $410,790 to defrauded victims and to pay a further $35,000 in administrative fines.
How Can I Avoid Securities Fraud in Arizona?
Investors should review their account statements regularly, and look out for common examples of broker misconduct:
- If there are unexpected losses, investors should consider whether their broker recommended a security with an unsuitable amount of risk. FINRA Rule 2111 requires brokers to recommend investments that fit their investor’s risk tolerance and financial goals.
- Broker misrepresentation and omission occurs when a broker omits material information about an investment – information which may affect an investor’s decision to invest. This includes information about fees, maturity dates, and tax implications.
- Unauthorized trading is a common concern. Investors should make sure their broker is not exercising discretion in accounts where they do not have authorization to do so.
These are just a few types of FINRA broker fraud that investors should keep in mind.
Investing Scams in Arizona
The ACC Securities Division also offers a few tips for avoiding scams:
- Make sure you thoroughly understand an investment and turn down any “opportunities” that come with guaranteed returns and no risks.
- “Boiler rooms” refer to groups of salespeople that use high-pressure tactics to pressure unsuspecting investors to purchase risky or fraudulent offerings. Simply say no to any solicitations from strangers.
- Similarly, do not respond to solicitations for investments via mail or online messages.
Arizona also warns that there are a few commodities that frequently appear in scams.
- Real estate investment fraud is common, thanks in part to many investors wanting a part of the real estate market.
- Foreign currency scams with guaranteed profits and supposedly no risk are best avoided. The ACC specifically calls out claims of better trades in the “interbank market.”
- Oil and Gas scams may claim to have drilling sites near legitimate oil wells. Arizona directs investors to review information provided by the North American Securities Administrators Association for tips on avoiding fraudulent oil and gas investments. For instance, potential investors should be wary if a salesperson tells them a geologist gave them a hot tip about an oil well.
Frequently Asked Questions (FAQs)
Your Firm is Located in New York City. Do I Need an Arizona Lawyer?
FINRA arbitration does not require an Arizona lawyer. Investment fraud victims often have representation from out of state. Kurta Law attorneys can travel to the arbitration hearing location closest to you.
Where Will My FINRA Arbitration Hearing Take Place?
FINRA provides a hearing location in Phoenix – or the hearing will take place over Zoom.
How Much Does It Cost to File a Claim?
You do not have to pay anything upfront. Our securities lawyers only collect a fee if you win your case.
Contact Kurta Law Today
It does not matter where you are located in Arizona. Our Arizona securities fraud attorneys can provide expert guidance and free case evaluations. Call (877) 600-0098 or email info@kurtlawfirm.com.