Recommending Unsuitable Investments:
It is the duty of a broker to make investment recommendations
to customers that are consistent with the customer’s risk
tolerance, needs, and investment objectives. An investment
may be unsuitable if a client does not have the
financial ability to incur the risk associated with a particular investment,
the investment was not in line with the clients financial needs, or
the client did not know or understand risks associated with certain investments.
Stockbrokers have the duty to know their customers and to ensure
that each recommended investment is suitable for that customer
in light of factors such as the customer’s age, financial status, ability
and willingness to handle risk, investment knowledge and experience, and
investment objectives. If you lost money in an unsuitable investment, the
broker may be responsible.
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