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What Does SEC Say About Investor Broker Relationship?

The stock market in the US is worth more than any other country in the world. Every year, it collects trillions of dollars from investors through various security trades. 

The individual investors who buy these securities are called retail investors, whereas the commercial body that helps them in this regard is called the broker. It’s a company that buys or sells securities for retail investors. Two great examples of brokers in the US are Merrill Lynch and Morgan Stanley. 

SEC’s Take On Investor Broker Relationship:

According to the Securities and Exchange Commission (SEC), brokers and investors are two parties that enter into a contract with each other where one party pays a fixed percentage of the fee to the other party for letting it invest in various securities. The duty of the other party is to uphold that promise and make sure that investors don’t have to face any trouble while exercising their rights. 

If investors fail to pay the fee or indulge in buying or selling of securities not permitted by SEC, brokers have the right to suspend their account. Similarly, if brokers don’t live up to their promise and recommend securities to investors for the sole purpose of making profits, then investors have the right to sue them in court. 

Many such cases can be found online where brokers were sued in court and asked to pay compensation to investors for losses they had to incur due to wrong advice given by brokers. 

If you or someone you love have faced a similar situation wherein you were promised huge returns on some securities by your broker, but eventually that deal proved to be a huge loss-making transaction for you, then you can file a lawsuit against your broker. 

For this, you must get in touch with a law firm like Erez Law that specializes in handling such cases and carries a success rate of 99%. The best thing about hiring it is that you don’t pay it any fee until it wins you the case. So, make sure you connect with this law firm in case your broker doesn’t live up to its promises.

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