Financial Advisor Negligence

Financial and investment advisors often take advantage of investors in a variety of ways. Sometimes this takes the form of outright fraud or misconduct. Other times, financial advisors can simply be negligent. Investors have lost hundreds of thousands or millions of dollars to financial advisor negligence simply because financial advisors were inattentive, acted too slowly, or failed to do their due diligence before recommending an investment.

If you want to sue your financial advisor for negligence, you may be able to recover your losses.

Bad financial advisor? We can help

Get a free consultation from a securities attorney. We may be able to recover your losses.



Investment advisors have a duty to properly care for their clients and work in the client’s best interest. If you believe your financial advisor did not properly care for your interests, intentional or not, you may be entitled to recover your losses through FINRA or securities arbitration or a financial advisor lawsuit.

Advisor Negligence Examples

Unsuitable Investments

A good financial or investment advisor should have an understanding of your circumstances as an investor and recommend only suitable financial products for your age, investment objectives, experience, and desired level of risk. But negligent advisors will sometimes steer you towards risky or unsuitable investments to obtain higher commissions. If your financial advisor placed you in an unsuitable investment for any reason, you may be entitled to monetary recovery.

Failure to Disclose Important Information

Financial and investment advisors should be able to provide as much detail about your investment as possible, and clearly articulate why the investment is right for you. This means that your advisor must disclose any known risks associated with the investment. If your financial advisor is omitting facts, you may be eligible to pursue arbitration or a lawsuit.

Investment Over-concentration

Diverse investment portfolios help protect investors against excessive losses due to a single sector or type of investment. Investment over-concentration is when a financial or investment advisor fails to diversify a customer’s portfolio, subjecting this customer to excessive risk of loss. If your financial advisor did not properly diversify your portfolio, you may be able to recover your losses.

Sue Your Investment Advisor for Negligence

You may be required to bring your case in a particular forum, depending on your state of residence, the investments you hold, and the terms of the contract or customer agreement you signed when you began working with your advisor. Generally, investors can sue their financial advisors over negligence through arbitration or civil lawsuits.

Even if there was no harmful intent associated with your advisor’s negligence, you may still be entitled to recover your losses. All you must do is prove that your advisor, or the firm, failed to live up to the standards expected of those who give investment advice.

Recover Your Losses

If you think your financial advisor took advantage of you or a family member, there are steps you can immediately take to fight back:

  1. Don’t delay
    Every legal claim has a certain amount of time in which you must file a lawsuit (known as a “statute of limitations”). If you don’t act within that time period, you may lose your ability to sue your broker. Sometimes when investors discover that they have been defrauded, they feel embarrassed and ashamed; this can paralyze people and prevent them from seeking help or taking quick action. Reacting rapidly when you discover a possible fraud is incredibly important because the passage of time may affect your rights.
  2. Gather your documents
    Financial statements, stock trades, customer agreements, emails, and other correspondence with your financial advisor could be relevant and useful. If don’t have immediate access to all records that are relevant to your case, however, we are still happy to consult with you.
  3. Consult with an experienced financial fraud lawyer
    Our skilled financial fraud lawyers can conduct an account audit to determine the full extent of your damages and determine whether misconduct occurred. Investment or financial advisors who commit one type of fraud or scam often don’t stop there — understanding the full extent of the harm is critical to determining how best to proceed.

No Cost to File

Some investors are concerned about the prospect of paying an hourly rate or having to pay out-of-pocket in advance for legal representation to sue their financial advisor. We represent our clients on a contingency or “success-fee” basis, which means that if you win the case, the lawyer’s fee comes out of the money awarded to you. If you lose, you will not be required to pay your attorney for the work done on the case.

We are happy to discuss any questions related to our fees as well as different arrangements we can structure.

Scott Silver

Scott focuses his law practice on securities arbitration and litigation and plaintiff-side class action litigation, representing individual investors and institutions in claims against brokerage firms, investment advisors, commodities firms, hedge funds and others.

Eileen Epstein Carney

Eileen is involved in the firm’s securities practice and has over a decade of experience in the legal world. She received her law degree from American University in 2005.

Dave Stein

David’s advocacy has generated major recoveries for consumers impacted by financial fraud. He was named to the Top 40 Under 40 by Daily Journal and a “Rising Star in Class Actions” by Law360.

Amanda Karl

Amanda is spearheading a securities lawsuit against NantHealth concerning fraudulent statements to investors about the success of its key product.

Our Financial Fraud Experience

Gibbs Law Group’s financial fraud and securities lawyers have more than two decades of experience prosecuting fraud. Our attorneys have successfully litigated against some of the largest companies in the United States, and we have recovered more than a billion dollars on our clients’ behalf.

We have fought some of the most complex cases brought under federal and state laws nationwide, and our attorneys have been recognized with numerous awards and honors for their accomplishments, including Top 100 Super Lawyers in Northern California, Top Plaintiff Lawyers in California, The Best Lawyers in America, and rated AV Preeminent (among the highest class of attorneys for professional ethics and legal skills).
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