ISRAELS & NEUMAN, PLC – Rhode Island Securities Attorneys

Sections 501 and 605 of the

Rhode Island Uniform Securities Act.

Israels & Neuman are securities arbitration and investment fraud attorneys that represent Rhode Island residents who have been wronged by their stockbrokers and brokerage firms.  Our investment fraud attorneys have previously represented investors in Rhode Island, including investors from the Providence area who lost money in the Charles Schwab YieldPlus Fund.

The residents of Rhode Island are protected by the provisions of the Rhode Island Uniform Securities Act.  This Act provides for the regulation of the sale of securities to Rhode Island residents and to Rhode Island financial advisors and stockbrokers.  Additionally, the Rhode Island Securities Department, with offices in Cranston, was created to help enforce the provisions of the Rhode Island Uniform Securities Act.

Section 501 of the Rhode Island Uniform 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:

• 7-11-501 – Offers, sales, and purchases. – In connection with the offer to sell, sale, offer to purchase, or purchase of a security, a person may not, directly or indirectly:

(1) Employ a device, scheme, or artifice to defraud;

(2) Make an untrue statement of a material fact or omit to state a material fact necessary in order to make the statement made, in the light of the circumstances under which they are made, not misleading; or

(3) Engage in an act, practice, or course of business that operates or would operate as a fraud or deceit on a person.

See 7 R.I. Gen. Laws § 7-11-501.  The Rhode Island Uniform Securities Act further provides civil remedies in the event that the Act is violated:

• 7-11-605 – Civil liability. – (a) A person who offers or sells a security in violation of § 7-11-201, 7-11-301(1) or (2), 7-11-305(k), 7-11-501, 7-11-503, or 7-11-505(b) is liable to the purchaser of the security from that person. Upon tender of the security, the purchaser may recover the consideration paid for the security and interest at the legal rate of this state from the date of payment, costs, and reasonable attorney’s fees as determined by the court, less the amount of income received on the security. Tender requires only notice of willingness to exchange the security for the amount specified. If that purchaser no longer owns the security, the purchaser may recover damages. Damages are the amount that would be recoverable upon a tender less the value of the security when the purchaser disposed of it, plus interest at the legal rate of this state from the date of disposition of the security, costs, and reasonable attorney’s fees as determined by the court.

(b) A person who offers or sells a security in violation of § 7-11-501 or 7-11-503 is not liable under subsection (a) if:

(1) The purchaser knew of the untrue statement of a material fact or omission of a statement of a material fact; or

(2) The seller did not know and in the exercise of reasonable care could not have known of the untrue statement or misleading omission.

See 7 R.I. Gen. Laws § 7-11-605.

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 Rhode Island, and in Providence, Cranston, Warwick, Pawtucket, East Providence, Woonsocket, Coventry, Cumberland, Johnston, and others. Our securities attorneys have represented over one thousand investors against many brokerage firms in the past.

Click to view:  Rhode Island Uniform Securities Act

Click to view:  Rhode Island Uniform Securities Act Civil Remedies

Click to view:  Rhode Island Uniform Securities Act Anti-Fraud Provisions

If you are a resident of Rhode Island and have lost money with your financial advisor or investment advisor, please CONTACT ISRAELS & NEUMAN at 206-795-5798 for a free evaluation of your case.