Auction Rate Securities
When the stock market collapsed, many people headed straight for their auction rate securities (ARS) funds to withdraw the money they had in these accounts. Upon calling their banks to take out the money they so desperately needed, they were informed that their money was frozen. They could not withdraw their money. When this occurred, Napoli Bern Ripka Shkolnik, LLP stepped up immediately to help. Our lawyers stood at the ready, offering experienced legal counsel to help people with frozen auction rate securities funds recover their money.
An auction rate security is a long-term debt that acts as a short-term debt because interest rates are reset periodically (usually every month) and interest is paid periodically (every quarter, twice a year or after the auction yield is settled). Auction rate securities are sold at the interest rate that will clear the market at the lowest possible yield. Many people with auction rate securities turned to these as last resort options to alleviate their financial difficulties with the market crash. Instead of getting the money they needed, they found that it was "frozen" in accounts that they could no longer access.
Many of these securities collapsed as well. Investors were left in the cold with nowhere to turn. The legal team at Napoli Bern Ripka Shkolnik, LLP utilized their experience and resources to help wronged investors in their time of need, investigating frozen auction rate securities funds and bringing arbitration claims against at-fault parties for their wrongdoing. Misrepresentation has been found to be the most common grounds for most of these arbitration claims. Many of the people who put money in these accounts did so with the understanding that they would be able to access the money whenever they wished. That proved untrue when the market collapsed and they were told they would not be able to withdraw the funds they needed.
Misrepresentation of Auction Rate Securities
Misrepresentation is a serious form of investment fraud. It occurs when a broker or brokerage firm alters information, provides entirely false information or even withholds important information about an investment of some kind. Investors are entitled to full disclosure and should be given recommendations that align with their investment objectives, risk tolerance and net worth. Stockbrokers and brokerage firms may be held accountable for misrepresentation that results in investor losses through Financial Industry Regulatory Authority (FINRA) arbitration proceedings. In some cases, an investor may be able to file a lawsuit, though arbitration is the only form of dispute resolution allowed in most investment contracts.
Contact Napoli Bern Ripka Shkolnik, LLP to Discuss Your Options
Napoli Bern Ripka Shkolnik, LLP is a nationally recognized firm with headquarters in the Empire State Building in New York City. We help investors who are living in New York and across the country who are suffering from financial losses caused by misrepresentation, negligence and other forms of securities fraud committed by unscrupulous brokerage firms and brokers.
Your broker's misrepresentation of auction rate securities as "risk-free" may provide you with sufficient grounds for an arbitration claim, wherein you may seek to recover the losses you have experienced. If you feel you were tricked or misled in relation to your auction rate security fund, contact a securities arbitration lawyer at Napoli Bern Ripka Shkolnik, LLP today. You can call our office at 888.870.2757 or can complete the quick contact form at the right of the screen and we will get back to you as soon as possible. With our insight to guide you on the right track, you will be one step closer to recovering the financial losses you have experienced.