Whether you are planning a new investment or recovering money lost due to a ponzi scheme, stockbroker misconduct, or private investment manipulation, a securities attorney is your best bet to help ensure or restore financial well-being. A securities lawyer is conversant with the laws and regulations set forth by the Securities and Exchange Commission (SEC) and other Blue Sky Laws to help you pursue a case of fraud to a favourable end; whether at the federal or state level.
There has been a 13.3 percent increase in securities and investment frauds since 2015. In 2019, 76,538 securities fraud cases were reported of which 2,954 were investors' complaints against stockbrokers malpractices. In the same year, nearly $1.2 billion was returned to harmed investors, of which over $25 million was paid to aggrieved clients as restitution by stock brokerage firms.
There is a high risk of losing your hard-earned money entirely if you pursue an investment scam case on your own or with an unqualified lawyer. An experienced attorney near you specializing in securities fraud can help file an arbitration claim or a lawsuit to remedy an investment loss. When reporting a fraud incident to the Securities and Exchange Commission, state securities regulators or law enforcement authorities ensure to take a securities attorney along so as not to undermine the prospect of recovering your loss by what you say.
If you are a victim of a financial scam, it is always in your best interest to make sure that when you search for a â€œsecurities attorney near me,â€ experienced enough to resolve your securities-related legal tasks properly. As such, the following questions have been carefully curated to assist you with the hiring process:
Where Are You Licensed to Practice Securities Law in the State You Are?
Although broker agreements typically contain arbitration clauses that result in many securities-related matters being settled out of court through arbitrations, some of these types of matters still end up being litigated. As such, it is necessary to make sure that your securities attorney is authorized to practice securities law in your state of residence.
Securities cases are filed in either state or federal trial courts. Before a securities attorney near you can represent you in any of these courts, this attorney must be licensed and sworn in by the supreme court of the state where your case is filed through its bar association. Only attorneys that have sat for and passed a state-administered bar examination can be issued with licenses and sworn into the legal practice. Because states have varying eligibility requirements for admission into their bar associations, securities attorneys that wish to practice in more than one state are usually required to pass the bar examination for each of these states. However, some states have reciprocity arrangements where attorneys that have been licensed in one state do not have to sit for the bar examination in a reciprocal state before they can practice there. For example, Pennsylvania has reciprocity arrangements with states like Texas, New York, and Ohio, while Alabama has reciprocity arrangements with states like Illinois, Michigan, and Georgia. To represent you in a federal court, a securities attorney must be admitted into the practice of that particular court. The eligibility requirements for federal courts also vary by court, and some courts admit attorneys that have been licensed to practice by any state bar association in the country while others only admit attorneys that have been licensed by specified state bar associations.
To confirm the licensing status of any securities attorney near you and verify whether this attorney can represent you in the state or federal court where your securities-related matter is filed, you should contact your state's bar association or the particular federal district court respectively. Also, because FINRA arbitration and mediation is a popular non-litigation method of resolving securities-related matters, it is a good idea to make sure that your securities attorney is not included in a list of individuals barred by this organization.
What Kind of Securities Work Do You Handle?
When hiring a securities attorney, it is necessary to find out whether this attorney specializes in a particular aspect of securities law. Securities law can be broadly grouped into four practice areas, which are:
- Regulatory securities law: Securities attorneys that specialize in this practice area help clients comply with federal and state securities regulations and laws. This includes preparing, reviewing, and ensuring the timely release of mandated information disclosures and other regulatory filings.
- Litigation securities law: This securities law practice area involves resolving disputes that arise from the buying and selling of securities either through traditional litigation or resolution methods like arbitration and mediation. Securities attorneys that specialize in this area represent both investors and corporate entities.
- Transactional securities law: This practice area involves advising clients on matters related to public securities offerings. This includes negotiating investment deals as well as preparing and reviewing documents. Securities attorneys that specialize in this practice area typically focus solely on corporate clients.
- Administrative securities law: Securities attorneys that specialize in administrative securities law typically focus on either pursuing or defending allegations of non-compliance and violations of securities laws made by regulatory authorities against corporate entities.
Although many experienced securities attorneys do not limit themselves to only one practice area, it never hurts to get proper confirmation on this from your attorney. As such, you should always make sure that the securities attorney near you that you intend to hire specializes in the practice area of securities law that is relevant to your situation.
How Long Have You Been in Practice?
Level of experience is an important requirement when hiring a securities attorney nearby. Securities laws at both the federal and state level are incredibly complex and so it is always in your best interest to hire a securities attorney that has had years of practice navigating and understanding these laws. You can find out when your securities attorney was sworn into the legal practice by contacting your state's bar association. Many securities attorneys and law firms also display their level of experience on their official websites. However, in addition to years of securities law experience, you should also find out how much experience your securities attorney has had in handling matters that are similar to yours. Requesting a practice breakdown from your securities attorney is a good way to get this information. Note that your attorney may not give you explicit details of past cases. However, a practice breakdown should give you a broad idea of your attorney's caseload and the percentage of securities cases similar to yours that your attorney has handled.
Do You Charge Fixed or Hourly Fees?
Securities attorneys typically charge clients using a contingency fee structure. With this type of fee structure, you will pay your attorney a percentage of any monetary recovery gotten for your investment loss claim. The exact percentage depends on the complexity of your case and any agreements reached between you and your securities attorney, and it typically ranges from 25% to 40% of the total money recovered. The advantage of the contingency fee structure is that you do not have to pay any attorney fees if your securities attorney fails to recover any of your lost funds. However, you may be required to cover other costs like expert fees and court costs regardless of whether you win the case or not. Some securities attorneys may offer to pay these costs and subsequently deduct them from any winnings, while others may offer you a payment plan for these costs.
While many securities attorneys near you would utilize a contingency fee structure, some of them may also utilize either an hourly fee structure or a flat fee structure. These types of fee structures are typically only used for securities matters that do not involve litigation. Securities attorney hourly fees cost an average of $200 - $500 per hour, while the cost of flat fees is usually determined by the complexity of the security matter and it can be as low as $250 or as high as $1,000.
Get a written fee agreement from your securities attorney that specifies the fee structure you are being charged with and what this fee structure entails. This should include details like the percentage you will be charged for contingency fees and whether you will need to pay a retainer fee if you are being charged with an hourly or flat fee structure. This fee agreement should also clarify whether your attorney fees will cover the cost of other case-related activities like court costs and hiring experts, or whether you will have to pay for these separately.
Do You Charge for an Initial Consultation?
Although securities attorneys typically offer prospective clients free 20 â€“ 30 minutes initial consultations to help them evaluate their case, some of them may charge for these initial consultations. Therefore, you should always verify this with the attorney when scheduling your initial consultation. Regardless of whether an initial consultation is free or comes at a cost, you should always use this opportunity to provide the securities attorney with all the relevant details of your securities matter. Also ask questions concerning the attorney's fee structure, available payment plans, preferred payment methods, attorney-client confidentiality, and strategies for pursuing the matter. While a security attorney near you might not go into explicit strategy details during an initial consultation, you should be able to use this time to determine if this attorney's proposed strategies will be a good fit for you.
How Do You Keep Clients Informed about Their Case?
Per Rule 1.4 of the American Bar Association's model rules of professional conduct, your securities attorney is required to perform the following activities:
- Promptly inform you of any new decisions or change in the circumstances of your matter
- Consult with you on ways to achieve your preferred outcome concerning your matter
- Update you on the status of your matter regularly
- Promptly respond to any requests for information related to your matter that you may have
To ensure that your securities attorney complies with this rule in a way that is beneficial to you, it is advisable to come up with an appropriate communication plan. This plan should clearly state how often you will receive regular non-emergency updates on your matter, how these updates will be delivered, who will deliver these updates, and circumstances that may require emergency communication. It is also a good idea to make sure that you can contact your securities directly in the event of an emergency without having to go through paralegals or legal assistants.
Who Will Actually Do the Work?
Securities law generally involves a lot of documentation, analysis, and research, and many securities attorneys employ paralegals to assist them with these tasks. As such, there is a very high likelihood that a paralegal will be involved in your securities matter when you hire a securities attorney. The specific tasks that a paralegal will perform on your securities matter largely depend on the discretion of your securities attorney. Nonetheless, Rule 5.3 of the American Bar Association's model rules of professional conduct specifies that the execution of these tasks must always be overseen by a licensed attorney.
Always ask your securities attorney the level of involvement that paralegals may have with your matter, and whether you will be required to pay separate fees for these paralegals. Note that the level of involvement that paralegals can have in a legal matter does not extend to setting their fees, representing clients in court, or offering legal advice.
Can You Provide References from Former Clients?
Having a good reputation should be a non-negotiable requirement for hiring a securities attorney near you. You can find out a securities attorney's reputation through online research and word-of-mouth. Contact either your state's bar association or the public investors bar association to find out whether any complaints, pending investigations, or disciplinary actions have been filed against your securities attorney. Look out for a testimonials page on the website of your securities attorney and peruse any reviews posted there. You can search for more balanced reviews on your attorney through unbiased third-party websites like Better Business Bureau and Google Review. Ask your securities attorney for a list of references and contact these individuals to get their opinions concerning this attorney. You can also get word-of-mouth reviews from the court officials that work at the state and federal courthouses your securities attorney practices at.
What Is Your Success Rate?
Successful outcomes in securities-related matters generally depend on your side of the case. If you are an investor, then getting your money recovered or being appropriately compensated for any monetary losses is a successful outcome. On the other hand, if you are a corporate entity that has been accused of violating federal or state securities laws and regulations, then getting the case dismissed in pretrial motions is a successful outcome. Regardless of your side of a case, it is always a good idea to hire a securities attorney near you that has a track record of delivering your preferred outcome. Some securities attorneys state their success rates on their websites. You can also find out the likelihood of your securities attorney resolving your matter in your favor through online research and testimonials from the attorney's past clients and professional colleagues. Information gotten through these avenues should be able to give you a broad idea of your securities attorney's overall skills and legal prowess.
When Should I Hire a Securities Attorney?
While you can invest in securities or pursue other securities-related matters without a securities attorney, it is always best to hire one to assist you with these activities. A securities attorney protects your investments by helping you navigate the complexities of securities laws and regulations and ensuring that securities companies, brokers, and brokerage firms comply with these laws and regulations when selling you any securities. You should hire a securities attorney near you immediately you find yourself in any of the following situations:
- You lost money that you invested in securities as a result of misconduct by either your broker, brokerage firm or securities company
- You are unsure if you can trust the company that you want to purchase securities from
- You have been accused of violating a federal or state securities law or regulation
- You want to take your company public
What Are the Typical Qualifications Held by a Securities Attorney?
Securities attorneys are mandatorily required to obtain a state-issued license before they can practice securities law. This license can only be obtained after the attorney has spent a minimum of seven years completing both undergraduate and law school education, and passing a state-administered bar examination. While there are no required courses for undergraduate study, securities attorneys typically offer finance, accounting, and any other courses related to the reading and understanding of financial data.