Sonn & Erez
Financial Injury Lawyers
Call Toll-Free: 1-866-FRAUD-11
Misrepresentation and omissions
Unauthorized trading
Churning (excessive trading)
Annuity switching
Unsuitability
Excessive use of margin
What does it mean when I purchase securities on margin?
When you use a margin account, you are borrowing money from a brokerage firm. When purchasing securities on margin you use a combination of your own funds and the funds you borrowed from the brokerage firm. These securities are the firm’s collateral for the loan. When the securities in your account decline in value, so does the value of the collateral supporting your loan.
If the value of the securities declines substantially, the brokerage firm will take action to shore up the value of the account by issuing a margin call.
Whether or not your firm chooses to issue a margin call, the firm has the right to liquidate securities in your account in order to meet its equity requirements for customer margin accounts.
Should your firm actually issue a margin call, it may give you a very limited time to satisfy the call. This time may be decreased from the amount of time that a firm may normally allow, in the event the markets are experiencing unusually volatile conditions.
Failure to diversify (over concentration)
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