When an investment account does not look the way you expected, it can be unsettling to figure out what happened. Statements may contain unfamiliar transactions, fees, or investment changes that are difficult to understand without reviewing the account history. Even when the explanation is not immediately clear, the records maintained by your broker can provide important details about how your account was managed. Taking the time to review those records can help identify questions that may require further attention.
Start With Your Account Statements
Account statements provide a useful starting point because they show activity over a specific period. Reviewing several statements together may reveal changes that are difficult to notice when looking at a single document.
Look for transactions you do not recognize, significant changes in holdings, unexpected withdrawals or transfers, unusual fees, or repeated purchases and sales. Pay attention to whether the activity appears consistent with your investment objectives and the instructions you gave your broker. A single unfamiliar entry may have a reasonable explanation, but a pattern of activity may warrant a closer review.
Examine Your Trade Confirmations
Trade confirmations can provide more detail about individual transactions in your account. These documents may identify the security involved, the number of shares or units purchased or sold, the transaction date, and other information associated with the trade.
When reviewing them, consider these three areas:
Authorization: Determine whether you remember approving the transaction or discussing it with your broker.
Investment selection: Consider whether the security appears consistent with the strategy and objectives you established for your account.
Transaction frequency: Look for repeated purchases and sales that may warrant questions about why the trades occurred.
Comparing trade confirmations with account statements and your communications with the broker can help create a clearer picture of the activity. Differences between these records may also be worth investigating.
Review Your Communications With the Broker
Emails, letters, account messages, and other communications can provide context that account statements cannot. They may show what your broker recommended, how an investment was described, or what you understood before agreeing to a transaction.
Keep communications that discuss investment objectives, risks, fees, recommendations, account changes, or specific instructions. It can also be useful to preserve messages exchanged before and after a disputed transaction. These records may help establish what was communicated and whether the account activity matched those discussions.
Vernon Litigation Group regularly reviews trading records, account statements, and communications when evaluating potential investor claims. A complete record can be particularly important when questions involve unsuitable recommendations, unauthorized trading, misrepresentation, or other broker misconduct.
Check Your Broker's Public Record
Private account records are only part of the information investors can review. FINRA BrokerCheck provides publicly available information about registered brokers and investment professionals, including employment history and certain disclosure events.
Consider reviewing the broker's record for customer complaints, regulatory actions, and other disclosures. However, a disclosure does not by itself establish that misconduct occurred. The nature of the allegation, its status, and the surrounding circumstances should be considered before drawing conclusions about a broker's conduct.
Broker records can be especially useful when combined with the documents from your own account. Comparing the broker's reported history with what occurred in your account may help identify issues that deserve additional attention.
Organize Records Before Seeking Advice
If your review raises concerns, keep the relevant documents together rather than relying on individual statements or recollections. Organizing the information chronologically can make it easier to understand when a transaction occurred, what preceded it, and how the account changed afterward.
Consider keeping:
Account records: Statements, confirmations, transaction histories, and fee records.
Investment documents: Agreements, disclosures, prospectuses, and materials provided when investments were recommended.
Communications: Emails, letters, messages, and notes concerning conversations with your broker or advisor.
Do not alter or discard original records, even if some documents appear unrelated at first. Information that seems minor may become relevant when the account activity is reviewed as a whole.
Know When a Closer Review May Be Appropriate
Reviewing broker records does not automatically mean that a legal claim exists. Investment accounts can change for many legitimate reasons, and market losses alone do not establish wrongdoing. The purpose of reviewing the records is to understand what occurred and determine whether the activity raises specific concerns.
If you find transactions you did not authorize, recommendations that appear inconsistent with your objectives, unexplained losses, or other indications of possible misconduct, Vernon Litigation Group can review the circumstances and help you understand your options; contact (239) 319-4434 today to discuss your potential investor claim.