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Investment Fraud — What to Do if You are a Victim

On Behalf of | Aug 29, 2018 | Investment Disputes

Buffington Law Firm’s breach of contract and investment fraud attorneys have successfully handled numerous cases involving investment fraud. Last week we described the nature of a typical fraudulent investment scheme. The red flag indicator that one’s investment is fraudulently invested is when the investor seeks to legitimately cash in all or part of the investment, and the investment manager delays or balks at honoring the request. After working many such schemes over the past two decades, we have learned that this is an unfailingly accurate “red flag” that fraud may be present.

Once a person suspects that he or she is the victim of investment fraud, the question becomes what to do about it. Reactions by people vary. Some people call the police and try to get the “white collar crime” group to handle the matter. Other times we have seen clients contact the FBI or the Securities and Exchange Commission (SEC). These are all fine organizations staffed with good people, but we do not believe that these alternatives represent the only solution for an investor who is being defrauded.

We believe that if a person is victimized by a fraudulent investment scheme, the best alternative is to retain legal counsel and likely file a lawsuit in State or Federal Court. The reason for this is straightforward. When an attorney represents a client in a civil lawsuit of this type, the attorney has but one objective: recover as much of the client’s money as possible. While this may be one of the goals of a governmental agency, they have other goals as well, such as protecting the public-at-large, incarcerating wrongdoers, etc. A civil attorney by contrast is required to focus on one goal: recovery of the money and if possible punitive damages as well. This is usually also the primary goal of the victim of investment fraud.

Often, the perpetrators of fraudulent investment schemes try to delay the victims from filing a lawsuit. They sometimes agree to sign documents, or they tie the victims up with negotiation letters and so forth – all in an effort to delay a reckoning. Clients, especially clients who have not retained an attorney, often feel that they are asserting control of the situation by doing these things. In reality, delay in filing a lawsuit is the worst alternative a victim can follow. Competent attorneys know not to fall for this tactic. If the attorney’s investigation indicates that the client has been the victim of investment fraud it is important, no vital, that the attorney file a lawsuit as soon as practicable. This stops the statute of limitations from continuing to run, prevents evidence from becoming stale, and it levels the playing field by forcing the defendant to deal with the plaintiff in the context of the lawsuit. It is not too much to say that filing a lawsuit is the single most effective thing that a victim of a fraud can do.

If you believe that you have been the victim of investment fraud, call Buffington Law Firm immediately for a  free legal consultation, to which attorney-client privilege fully applies. Do not delay!