What We Mean by Investment Fraud & Identity Theft
This is the category where the conduct was intentional: forged signatures, funds moved out of your account, personal information used to open accounts you never authorized. It often surfaces only when a statement arrives that does not match what you believed you owned.
Unlike negligence, fraud involves deliberate, knowing misconduct. The broker or someone with access to your account acted intentionally to deceive you or steal from you. And critically, the brokerage firm that employed that person has a duty to detect and prevent this kind of conduct through its supervisory and compliance systems.
Warning Signs
Unauthorized Withdrawals
Withdrawals or transfers you did not request appearing on your statements.
Forged Signatures
Your signature on documents you never signed or authorized.
Missing Statements
Statements that stopped arriving, or are now going to a different address.
Unknown Accounts
Accounts opened in your name that you did not authorize or know about.
Types of Investment Fraud
- Conversion and theft: A broker misappropriates client funds — transferring money to their own account or a third party's
- Forgery: Signing the client's name on account documents, wire transfer forms, or trading authorizations
- Account takeover: Changing account contact information, passwords, or beneficiary designations without the client's knowledge
- Unauthorized account opening: Using a client's personal information to open new accounts the client never requested
- Elder financial exploitation: Targeting elderly or vulnerable clients who may not immediately notice unauthorized activity
Firm Liability
Brokerage firms are strictly obligated to maintain systems that detect suspicious activity — unusual wire transfers, changes of address, large withdrawals from elderly accounts, and patterns of forged documents. When those systems fail, or when the firm ignores alerts, the firm itself is liable for the resulting harm.
We frequently pursue claims against the employing firm rather than (or in addition to) the individual broker, because the firm typically has far greater financial resources to satisfy a judgment or settlement.
Suspect fraud or unauthorized activity in your account?
Act quickly — the sooner you contact an attorney, the better the chance of preserving evidence and recovering your money.
Request a Free Case Review Call 954-464-3739Frequently Asked Questions
Yes. If you suspect criminal fraud or identity theft, filing a police report is an important step. However, criminal proceedings do not recover your money — FINRA arbitration or civil litigation is needed for financial recovery.
The brokerage firm remains liable for its failure to supervise and for the acts of its former employees committed within the scope of their employment. Leaving the firm does not insulate either party from a FINRA claim.
FINRA's six-year eligibility rule applies, but fraud claims may also benefit from "equitable tolling" — the clock may not start running until you discovered (or reasonably should have discovered) the fraud.