Failure to execute claims against stockbrokers are often problematic.
Often customers will complain that their broker “refused” to sell the securities in their account, but often on further investigation, one will find that the broker simply recommended that the customer not sell a particular securities, which is most often a matter of judgment and sometimes with the benefit of hindsight, bad judgment, but is not actionable, certainly not as a failure to execute.
Other times, customers will complain that the broker refused to place an order to purchase securities, or refused to purchase additional securities in a margin account. However, this also is often not actionable as the broker has a right to refuse purchase transactions or refuse to continue to extend credit for just about any reason, on margin.
Other times, a customer will place a limit order, and see their security, however so briefly trade through that limit order and then complain that their order was not executed. What most customers do not understand is that in order of preference, particularly on an exchange, market orders are executed before limit orders, and if the price was not there long enough to accommodate the limit order, it may remain unexecuted.
However, sometimes, customers place orders, including limit orders which are never entered or executed because the broker is negligent.
Customers with such complaints need to act quickly, and not complain after receiving months of statements showing that they owned or did not own a particular security, later complain about a failure to execute. Even in cases where there is a bonafide failure to execute the customer’s damages may be limited to the difference in price of the underlying security when they knew, or more importantly, should have known the transaction was not effected.
Guiliano Law Firm
The Guiliano Law Firm, P.C. Practice limited to the representation of investors in claims against stockbrokers and investment professionals for fraud, the sale of unsuitable investments, breach of fiduciary duty, failure to supervise. National Practice. Contingent Fee. Free Consultation. If you think that you may have a claim for failure to execute, contact us for a free confidential evaluation at (877) SEC-ATTY.