Accountant, Arbitration, Commissions, Complaints, FINRA, Frequent Trading, Investment Attorney, Securities Attorney, Stockbrokers, Tax Returns, Trading Responsibility, Unauthorized Trading
You know the story. Little Billy is playing with matches on the hot summer day. He strikes the match, puts it to the small leaves he’s gathered and watches at first with pure joy as the small fire sparks and snaps as he expected. And then the wind picks up, spreading that small fire across the forest, moving ever so close to threatening the small family farm neighboring the forest. The fire is now beyond little Billy’s control and he can’t undo the damage. And then, just as the fire spreads to the farmhouse, Superman swoops in and puts out the fire. While there is damage from the fire, it is nothing compared to what would have occurred had Superman not arrived “in the nick of time”.
Like little Billy starting a fire, often your broker is playing recklessly with your investments, not looking to the long-term effects of the buying or selling of investments or paying attention to the investment environment. Because of this your investments throughout the year are consistently declining in value putting at risk your retirement goals. Your broker is telling you during this time the strategy he has put in place must be followed, for your benefit. However, like little Billy’s fire, it is moving to a dangerous place.
While accountants are not flying in and saving any farmhouses from fires, they are in place to play the part of Superman when it comes to your investments. In the first quarter of every year your accountant reviews your investment information for tax reporting purposes. Your accountant looks at your investment gains and losses. More importantly, your accountant reviews (or should) the commissions generated from the investment account as well as the number of trades made in the account. Superman uses his “freeze breath” to stop the fire; your accountant uses his or her calculator. With that tool, your accountant can tell you that when your broker said “all of these trades are necessary to reach your investment goals” what he really meant was “thanks for all these commissions” as the value of the account actually decreased over the last year.
Your accountant isn’t there to stop the trading before it happens, but with your accountant’s preparation of your tax returns, your accountant may very well play the role of Superman by “swooping in” and working with you to put a stop to the improper trading, ensuring your retirement does not go up in smoke. While you may not feel comfortable initially confronting your broker about the trading or the commissions in your account, talk to your accountant about what it is you want from your investment account, whether you authorized each of the trades in the account and whether you regularly talk to your broker. Your answers may very well put your accountant in place to “put out the fire” before it threatens your retirement.
When your broker improperly trades your investment account there are means to seek recoupment of the losses. There is a process in place to right such wrongs. However, use the means available to you, such as your accountant, to stop losses, significant losses, before they take place.
If you have questions relating to this topic or other investment matters, please contact The Law Offices of Barry M. Bordetsky by calling Barry M. Bordetsky at (800) 998-7705 or emailing at firstname.lastname@example.org.