Israels & Neuman, PLC – Arizona Securities Attorneys
Articles 13 and 14 of the Arizona Securities Act
Israels & Neuman are securities arbitration and investment fraud attorneys that represent Arizona residents who have been wronged by their stockbrokers and brokerage firms. Arizona residents are protected by the provisions of the Arizona Securities Act. This Act provides for the regulation of the sale of securities to Arizona residents and to Arizona financial advisors and stockbrokers. Additionally, the Arizona Securities Division, with offices in Phoenix, was created to help enforce the provisions of the Arizona Securities Act.
Article 13 of the Arizona Securities Act provides for liability if a financial advisor or investment advisor misrepresents the risks of an investment to you. In particular, this statute provides that:
- It is a fraudulent practice and unlawful for a person, in connection with a transaction or transactions within or from this state involving an offer to sell or buy securities, or a sale or purchase of securities, including securities exempted under section 44-1843 or 44-1843.01 and including transactions exempted under section 44-1844, 44-1845 or 44-1850, directly or indirectly to do any of the following:
- Employ any device, scheme or artifice to defraud.
- Make any untrue statement of material fact, or omit to state any material fact necessary in order to make the statements made, in the light of the circumstances under which they were made, not misleading.
- Engage in any transaction, practice or course of business which operates or would operate as a fraud or deceit.
B. In a private action brought pursuant to subsection A, paragraph 2 of this section or section 44-1992, if the person who offered or sold the security proves that any portion or all of the amount recoverable under subsection A, paragraph 2 of this section or section 44-1992 represents an amount other than the depreciation in value of the subject security resulting from the part of the prospectus or oral communication, with respect to which the liability of the person is asserted, not being true or omitting to state a material fact required to be stated or necessary to make the statement not misleading, then the amount shall not be recoverable. This subsection does not apply to any actions based on allegations of activities constituting dishonest or unethical practices in the securities industry.
See Ariz. Rev. Stat § 44-1991. The Arizona Securities Act further provides civil remedies in the event that the Act is violated:
A. A sale or contract for sale of any securities to any purchaser in violation of section 44-1841 or 44-1842 or article 13 of this chapter is voidable at the election of the purchaser, and the purchaser may bring an action in a court of competent jurisdiction to recover the consideration paid for the securities, with interest, taxable court costs and reasonable attorney fees, less the amount of any income received by dividend or otherwise from ownership of the securities, on tender of the securities purchased or the contract made, or for damages if the purchaser no longer owns the securities.
B. A person against whom an action for a violation of section 44-1991 is brought is not liable under subsection A of this section if the person sustains the burden of proof that the person did not know and in the exercise of reasonable care could not have known of the untrue statement or misleading omission.
See Ariz. Rev. Stat § 44-2001. The Act further provides:
A. A purchase or contract for purchase from a seller of securities made in violation of section 44-1842, 44-1991 or 44-1994 is voidable at the election of the seller of the securities, and the seller may bring an action in a court of competent jurisdiction to recover the amount of the seller’s damages, with interest, taxable court costs and reasonable attorney fees.
B. A person against whom an action for a violation of section 44-1991 is brought is not liable under subsection A of this section if the person sustains the burden of proof that the person did not know and in the exercise of reasonable care could not have known of the untrue statement or misleading omission.
See Ariz. Rev. Stat § 44-2002.
If your financial advisor or stockbroker makes misrepresentations to you when selling securities, he or she may be liable for your losses. In addition, the brokerage firm that your advisor works for may also be liable.
Israels & Neuman PLC is a securities arbitration and investment fraud law firm with offices in Denver, Colorado and the Seattle area. We represent investors in FINRA arbitration and securities arbitration proceedings in all 50 states, including representing investors previously throughout Arizona, and in Phoenix, Tucson, Scottsdale, Chandler, Gilbert, Mesa, Glendale, Tempe, and Peoria. Our attorneys have represented over one thousand investors against many brokerage firms in the past, including LPL Financial, Merrill Lynch, Morgan Stanley, Smith Barney, Stifel Nicolaus & Company, UBS Financial Services, Oppenheimer, Charles Schwab, Wells Fargo Advisors, Ameriprise Financial Services, Raymond James, ProEquities, Securities America, National Securities Corp., and many others.
If you are a resident of Arizona and have lost money with your financial advisor or investment advisor, please Contact Us at 720-599-3505 for a free evaluation of your case.