ISRAELS & NEUMAN, PLC – Texas Securities Arbitration and Investment Fraud Attorneys

Section 33 of the Texas Securities Act

Israels & Neuman are securities arbitration and investment fraud attorneys that represent Texas residents who have been wronged by their stockbrokers and brokerage firms.  Our attorneys have previously represented dozens of Texas investors who have been the victims of unsuitable investment recommendations, fraud, and theft, including the following:

1. Represented victims of a Ponzi scheme run by former Houston financial advisor Jeremy McGilvrey;
2. Represented numerous Texas investors who lost money in the Morgan Keegan bond fund collapse;
3. Represented numerous Texas investors who lost money in the Charles Schwab YieldPlus bond fund collapse;
4. Represented a San Antonio investor who lost money in numerous private placements, including an investment in Palmaz Scientific;
5. Represented two Houston-area victims of the Josh Abernathy Ponzi scheme; and
6. Represented investors from the Dallas area who lost money in non-traded real estate investment trusts (REITs).

Texas residents are protected by the provisions of the Texas Securities Act.  This Law provides for the regulation of the sale of securities to Texas residents and to Texas financial advisors and stockbrokers.  Additionally, the Texas State Securities Board, with offices in Austin, Corpus Christi, Dallas, Houston, Lubbock, and San Antonio, was created to help enforce the provisions of the Texas Securities Act.

Section 33 of the Texas Securities Act provides for liability if a financial advisor, stockbroker, or investment advisor misrepresents the risks of an investment to you.  In particular, this statute provides that:

(2) Untruth or Omission. A person who offers or sells a security (whether or not the security or transaction is exempt under Section 5 or 6 of this Act) by means of an untrue statement of a material fact or an omission to state a material fact necessary in order to make the statements made, in the light of the circumstances under which they are made, not misleading, is liable to the person buying the security from him, who may sue either at law or in equity for rescission, or for damages if the buyer no longer owns the security. However, a person is not liable if he sustains the burden of proof that either (a) the buyer knew of the untruth or omission or (b) he (the offeror or seller) did not know, and in the exercise of reasonable care could not have known, of the untruth or omission. The issuer of the security (other than a government issuer identified in Section 5M) is not entitled to the defense in clause (b) with respect to an untruth or omission (i) in a prospectus required in connection with a registration statement under Section 7A, 7B, or 7C, or (ii) in a writing prepared and delivered by the issuer in the sale of a security.

See Tex. Civ. Stat. § 33(A)(2).  This Section also allows for civil remedies in the event that this statute is violated:

(3) In damages, a buyer shall recover

(a) the consideration the buyer paid for the security plus interest thereon at the legal rate from the date of payment by the buyer, less

(b) the greater of:

(i) the value of the security at the time the buyer disposed of it plus the amount of any income the buyer received on the security; or

(ii) the actual consideration received for the security at the time the buyer disposed of it plus the amount of any income the buyer received on the security.

See Tex. Civ. Stat. § 33(D)(3).

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, Washington area.  We represent investors in FINRA arbitration and securities arbitration proceedings in all 50 states, including representing investors throughout Texas, and in Houston, Dallas, Fort Worth, Austin, San Antonio, Lubbock, El Paso, Corpus Christi, Allen, League City, Arlington, Plano, Laredo, Garland, and Irving.   Our attorneys have represented over one thousand investors against many brokerage firms in the past.

Click to view:  Texas Securities Act-TOC

If you are a resident of Texas and have lost money with your financial advisor or investment advisor, please CONTACT ISRAELS & NEUMAN at 720-599-3505 for a free evaluation of your case.