In an annual report more than two decades ago, Warren Buffett dispensed some wise words of knowledge: “You only find out who is swimming naked when the tide goes out.” Reportedly, Mr. Buffett was referring to knowing what risks a company is taking until it faces adverse conditions. Mr. Buffett used the same phrase again in 2008 about the foolishness of large financial institutions exposed by falling home prices.
Mr. Buffett’s words of wisdom can also be applied to investment recommendations made by a financial advisor in a bull market. Almost everyone looks like a genius in a booming market, including financial advisors. However, when the stock market enters into a correction, or something even more dreadful, the real risks of an investment or investment strategy are exposed, often leaving a trail of investment losses in their wake.
Investors who have suffered investment losses due to unsuitable or misleading investment recommendations by brokers or brokerage firms should consult with a lawyer to review their legal rights.
Fresh off of its historic arbitration award against Robinhood, New York securities arbitration law firm Iorio Altamirano LLP offers free and confidential consultations to investors who may have been financially harmed.
Who Should Consult a Lawyer?
Brokerage firms and financial advisors are required to have a customer’s best interest in mind when they make investment recommendations or offer investment advice. This obligation is mandated by the SEC.
Specifically, when a financial advisor makes an investment recommendation, it must be in the investor’s best interest and must not place the interest of the financial professional or brokerage firm ahead of the interests of the retail investor. This standard of care, which is commonly referred to as “Regulation Best Interest” or “Reg BI,” applies to recommendations to purchase securities, sell or hold securities, implement an investment strategy, or open a specific type of account.
Financial advisors must also be truthful and disclose all material facts and risks to the customer when making an investment recommendation. If the financial advisor omits or misrepresents material facts or risks, they could be liable for investment losses.
Investors who have suffered financial losses due to investment recommendations that were not in their best interest, or misleading investment advice, may be able to file a lawsuit, in the form of a FINRA arbitration, to recover losses.
About Iorio Altamirano LLP
Iorio Altamirano LLP is a securities arbitration law firm located in New York, NY. We represent investors nationwide and vigorously pursue FINRA arbitration claims on behalf of investors to recover investment losses.
We have nearly 20 years of combined experience as securities arbitration lawyers and have helped investors recover investment losses in over 1,000 cases. Our firm will file a FINRA securities arbitration claim on your behalf on a contingency fee basis to try to recover your losses. If we do not obtain a recovery, you do not owe us a legal fee.
If you have suffered investment losses, contact securities arbitration lawyers August Iorio and Jorge Altamirano of Iorio Altamirano LLP at august@ia-law.com, jorge@ia-law.com, or toll-free at (855) 430-4010 for a free and confidential consultation and review of your legal rights.