Securities Fraud and Mismanagement

Attorney and Counselor at Law

303-300-5022 / 844-253-5858 Toll Free

Did the actions/inactions of my broker fall below the required standard of care?

We’ll tell you, for FREE.

Brokerage Cyber Breach

Brokerage Cyber Breach

Securities brokerage cyber breach victims have recourse. We have successfully represented victims induced to wire funds due to false or fraudulent wire instructions from broker or criminals acting as brokers or who have illegally entered accounts. Please contact us for a free and confidential consultation.

Investors commonly believe that the criminal courts are their recourse for funds stolen by hackers, but this is rarely the case. Criminal cases are often ineffective to recover funds taken by cyber investment fraud. Investors are generally required to pursue FINRA arbitration for recovery. We can file suit with FINRA identifying the various regulatory and industry standards by those charged with overseeing accounts.

The FBI has identified the various types of cyber threats that brokerages, investment advisors, and other financial institutions should be aware. These institutions need to take proactive measures and guard against such threats.

Often, the cyber scheme is a targeted phishing e-mail that contains either an infected file or a link to an infected website. The e-mail recipient of the wire fraud is generally a person within a targeted company who can initiate fund transfers on behalf of the business or another valid online banking credential account holder. Once the recipient opens the attachment or navigates to the website, malware is installed on the user’s computer, which often includes a keylogging program that harvests the user’s online banking credentials.

The criminal then either creates another account or directly initiates a funds transfer masquerading as the legitimate user. The stolen funds are often then transferred overseas. Victims of this type of scheme have included small and medium-sized business, local governments, school districts, and health care service providers.

Other schemes hack email accounts and direct investors to transfer funds or use the information gather to wire the funds on their own to an account established by the hacker. The funds are then wired to some foreign jurisdiction where US authorities cannot recover.

In 2008, a Pennsylvania school district discovered that over $450,000 was missing from their bank account. The following year, a New York school district reported that approximately $3 million had been transferred out of their bank account. The New York’s school district’s bank was able to recover some of the transfers, but $500,000 had already been withdrawn from the account before the transaction could be reversed.

In each of these situations, the theft does not occur absent a failure of brokerage security. Please call for a free and confidential initial consultation.

Brokerage cyber breach cost investors millions.
A broker cyber breach can lead to a quick loss of your life savings.