When a brokerage firm agrees to employ a broker or allow him (or her) to maintain his (or her) securities licenses with it, that firm agrees to take responsibility for supervising the broker’s activities. If the broker breaches any of his (or her) duties or violates the securities regulations or breaks the law, the brokerage firm can be held responsible broker’s actions.
To satisfy its supervisory obligations, a brokerage firm is required to have a reasonable system of supervision in place, and it is required to reasonably enforce it. If a broker recommends or sells or participates in the sale of an investment, his (or her) brokerage firm can be held responsible for that investment’s subsequent performance — even if the firm did not give the broker permission to sell the investment (that is, the broker sold the investment “away” from the firm) — if (i) the firm was aware of the broker’s activities and took no action to stop them or (ii) the firm was unaware of the broker’s activities because it did not have a reasonable supervisory system in place to catch them.
If you purchased an investment based on a broker’s recommendation, or if a broker facilitated your investment (by making an introduction or transmitting documents or funds to or from you or in any other way), you could have a claim against his (or her) brokerage firm — regardless of what kind of investment it was or whether you even had a brokerage account with his (or her) firm. For example, if a broker introduces you to a real estate investment, helps you to invest in a business, or directs you to a person or company selling promissory notes, you could have a claim against that broker and against his (or her) brokerage firm.
If you purchased an investment that was “sold away” by a broker, contact Jacobson Law P.A. to discuss the specific facts of your case. You may have a claim and could be entitled to recover damages.