The founding attorneys of CMF spent the majority of their careers at large New York defense firms, representing brokers and broker-dealers in securities litigation, arbitration, administrative and regulatory proceedings before FINRA and the U.S. Securities & Exchange Commission. Having extensive experience working on both sides of the fence, we have a unique understanding of the complexities of securities arbitration, mediation, regulation and litigation. Because CMF represents both plaintiffs and claimants in civil matters, and defendants and respondents in administrative and regulatory matters, we are familiar with all of the relevant legal arguments.
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Financial advisors or securities firms often have fiduciary duties to their clients. A fiduciary is obligated to place the interests of the person to whom he owes the fiduciary duty (the investor) above his own interests.
When a broker agrees to execute an order, the broker and firm have a fiduciary duty of “best execution” – to not place the firm’s interest before the clients and to execute the order at the best price available in the marketplace.
When a broker agrees to manage client assets and/or obtain permission to place orders on their behalf, the brokers have additional fiduciary duties to these clients. Financial Advisors have an even greater fiduciary duty to their clients, and brokers and their firms are often considered fiduciaries to their clients when performing the same function.
Since investors are encouraged to place their trust and confidence in their broker whom they rely upon for expertise in making the investment decisions, the broker is held to an extremely high standard not to abuse that trust. Acts of fraud and misrepresentations, unauthorized trading, unsuitable trading and churning will generally also be the basis for a breach of fiduciary duty claim. A broker may also be subject to liability as a fiduciary for a pension or retirement plan account under the Employee Retirement Income Security Act (“ERISA”).