What is financial advisor misconduct?

Financial advisor misconduct refers to actions by a broker or investment advisor that violate securities laws, FINRA rules, or their duty to act in a client's best interest. Common forms include: making unsuitable investment recommendations, misrepresenting or omitting material facts, churning (excessive trading to generate commissions), unauthorized trading, over-concentrating a portfolio in a single security or sector, failing to supervise employees, and outright fraud or theft. Investors who suffer losses due to advisor misconduct can pursue recovery through FINRA arbitration.

What is a suitability claim against a financial advisor?

A suitability claim arises when a broker recommends investments that are not appropriate for a client's financial situation, risk tolerance, investment objectives, or time horizon. Under FINRA Rule 2111, brokers must have a reasonable basis to believe a recommendation is suitable for the specific customer. Recommending high-risk products to a retiree seeking income, or concentrating a portfolio in speculative securities for a conservative investor, are common examples of suitability violations that can support a FINRA arbitration claim.

Can I sue my financial advisor for investment losses?

Yes, investors can pursue legal claims against financial advisors for losses caused by misconduct. Most brokerage account agreements require disputes to be resolved through FINRA arbitration rather than court. To have a viable claim, the losses must have been caused by the advisor's wrongdoing — not simply by market declines. A securities attorney can evaluate whether your losses resulted from actionable misconduct. Bakhtiari & Harrison offers free consultations.

What is the largest FINRA arbitration award Bakhtiari & Harrison has won?

In 2011, Bakhtiari & Harrison won the largest FINRA arbitration award of that year — a $54 million award against Citigroup Global Markets, including $17 million in punitive damages, on behalf of two individual investors who suffered losses in Citigroup's Mat/ASTA leveraged municipal arbitrage fund. The award was described by the Wall Street Journal as the largest ever levied against a major Wall Street brokerage in favor of individual investors. The award was later confirmed by the U.S. District Court for the District of Colorado.

Does Bakhtiari & Harrison represent celebrity and athlete investors?

Yes. Bakhtiari & Harrison has represented professional athletes in the NFL, NBA, MLB, NHL, and Olympic Games, as well as entertainers and public figures, in securities fraud and investment misconduct cases. High-profile clients are frequent targets of unsuitable investments, fraudulent schemes, and advisors who exploit trust relationships. The firm handles these cases with the same level of confidentiality and strategic rigor as any other matter. In 2022, the firm represented multiple professional athletes including Lauren Holiday, Jrue Holiday, Chandler Parsons, and Courtney Lee in claims involving nearly $10 million in investment losses.

Elder Financial Fraud Attorneys — Bakhtiari & Harrison

Written and reviewed by

Ryan Bakhtiari, Partner — Bakhtiari & Harrison

Admitted: CA | NY | TX | DC | Multiple Federal Courts · Super Lawyers 2005–2026 · Former PIABA President · Former FINRA NAMC Chairman · Last reviewed: April 2026

Bakhtiari & Harrison represents elderly and vulnerable investors in securities fraud and elder financial fraud and abuse claims in FINRA arbitration and securities litigation nationwide. Elder financial abuse in the securities industry is one of the most serious and fastest-growing categories of investor harm — and California law provides remedies for elder investor victims that go significantly beyond standard FINRA arbitration recoveries, including treble damages and attorneys’ fee recovery under California Welfare & Institutions Code § 15657.5. Ryan Bakhtiari served as Chairman of the FINRA National Arbitration and Mediation Committee and has been a Super Lawyer every year from 2005 to 2026. Investor cases are handled on a contingency fee basis — no recovery, no fee.

Elder financial abuse in the securities industry

Elderly investors are among the most aggressively targeted demographic in the securities industry — and among the most seriously harmed when fraud occurs. The combination of accumulated retirement savings, trust-based adviser relationships, potential cognitive decline, and reduced financial sophistication creates conditions that bad actors specifically exploit. The consequences are devastating: elderly investors who lose retirement savings typically have no ability to rebuild them.

Elder financial abuse in the securities industry takes many forms — from unsuitable investment recommendations and variable annuity abuse, to private placement fraud, to outright theft of assets. In the most serious cases, advisers have systematically targeted elderly clients for years, extracting commissions and fees through a sustained pattern of misconduct that only comes to light when the investor’s family becomes involved or the losses become impossible to ignore.

Common elder financial abuse patterns

Variable annuity abuse: recommending long-surrender-period variable annuities to elderly investors who need liquid retirement income — locking up assets for 10 or more years in exchange for high commissions, often with no tax benefit for the investor.
Non-traded REIT recommendations: placing elderly investors in illiquid non-traded real estate investment trusts that cannot be sold and pay high commissions to the recommending broker.
Unsuitable private placements: recommending unregistered Regulation D private placements to elderly accredited investors without adequate disclosure of risks, illiquidity, and conflicts of interest.
Ponzi and affinity fraud: fraudulent investment schemes that specifically target elderly investors through community and religious networks.
Overconcentration: placing the majority of an elderly investor’s retirement assets in a single security, sector, or product — eliminating diversification that the investor’s age and financial situation demands.
Cognitive decline exploitation: advisers who continue to execute transactions without meaningful investor consent when the client’s cognitive decline is apparent — or who actively take advantage of diminished capacity to recommend self-serving investments.

California elder financial abuse law — additional remedies

California investors who are 65 or older (or dependent adults) have access to remedies under California Welfare & Institutions Code § 15610.30 et seq. that significantly exceed standard FINRA arbitration recoveries. When a financial professional commits elder financial abuse with recklessness, oppression, fraud, or malice, California law provides:

Treble damages: up to three times compensatory damages under California Welfare & Institutions Code § 15657.5.
Attorney’s fees: full recovery of attorneys’ fees in qualifying cases — eliminating the contingency fee from the investor’s recovery.
Punitive damages: available alongside treble damages when the conduct meets the heightened standard.

These California-specific remedies are available in addition to standard FINRA arbitration damages and are available even in FINRA arbitration proceedings. For detailed analysis of California’s elder financial abuse statutes and how they apply in FINRA arbitration, see the firm’s blog posts on Los Angeles financial elder abuse and elder financial abuse attorney representation.

FINRA Rule 2165 — financial exploitation of specified adults

FINRA Rule 2165 requires broker-dealers to place a temporary hold on disbursements from the accounts of specified adults (investors 65 and older, or adults with mental or physical impairment) when the firm has a reasonable belief that financial exploitation is occurring. Firms that fail to implement this rule — or that ignore warning signs of elder financial exploitation — face independent regulatory liability. Bakhtiari & Harrison pursues claims against both the broker and the firm in elder fraud cases, asserting independent failure-to-supervise liability where appropriate.

Frequently asked questions — elder financial fraud

What is the statute of limitations for an elder financial fraud claim in California?

Under FINRA Rule 12206, claims must be filed within six years. California elder abuse statute claims under Welfare & Institutions Code § 15657.5 have a four-year statute of limitations under California Code of Civil Procedure § 335.1. California securities law claims under Corporations Code § 25401 have a two-year period from discovery. The applicable deadline depends on the specific claims asserted — contact Bakhtiari & Harrison promptly as multiple deadlines may apply. Elder Financial Fraud

Can family members bring a claim on behalf of an elderly investor?

Yes. Family members who have power of attorney, conservatorship, or who are the personal representative of a deceased elderly investor’s estate can pursue FINRA arbitration claims on the investor’s behalf. Bakhtiari & Harrison regularly represents the families and estates of elderly investors who were victimized by financial fraud.

My elderly parent invested with a broker they trusted for years — can they have a claim?

Yes. The length of the adviser relationship does not diminish the legal claim — in fact, long-standing trusted relationships are frequently used to perpetuate elder fraud over extended periods, which may increase the damages period. Bakhtiari & Harrison evaluates all potential elder fraud claims at no charge.

Are California treble damages available in FINRA arbitration?

Yes. California Welfare & Institutions Code § 15657.5 treble damages and attorneys’ fee recovery are available in FINRA arbitration proceedings for California elderly investors. Bakhtiari & Harrison specifically pleads California elder abuse claims in FINRA arbitrations involving California investors age 65 and older.

For a full overview of the firm’s investor representation practice, visit the Advisor Misconduct page.

Contact a elder financial fraud attorney — free consultation

Contact Bakhtiari & Harrison for a free, confidential consultation. Our FINRA attorneys review every potential investor claim at no charge. Investor cases are handled on a contingency fee basis — no recovery, no fee.

Investor cases are handled on a contingency fee basis — no recovery, no fee.

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