Every investor experiences losses at some point. Markets rise and fall, economic cycles shift, and even the most carefully constructed portfolios can decline in value during periods of broad market turbulence. But according to national investment fraud law firm Haselkorn & Thibaut, P.A., there is a fundamental and legally significant difference between losing money because the market went down — and losing money because your broker or financial advisor did something wrong.

Understanding that difference, the firm says, is the first step toward knowing whether you have a winnable legal claim.

With over 50 years of combined experience, a 98% success rate, and offices in Florida, New York, North Carolina, Arizona, and Texas, Haselkorn & Thibaut has helped thousands of investors recover millions of dollars in losses — but only in cases where broker misconduct, not simple market forces, was the root cause of the harm.

What You Cannot Sue For: Normal Market Losses

Let's start with what does not constitute a viable legal claim.

If you invested in a diversified portfolio of stocks and bonds, and the broader market declined — as it did dramatically in 2000, 2008, 2020, and during the 2022 rate-hike cycle — that alone is generally not grounds for a legal claim. Markets are inherently volatile. Every investor who participates in the market accepts a degree of risk, and financial advisors are not guarantors of positive returns.

Similarly, if your advisor recommended a well-known, publicly traded stock that subsequently declined in value due to company-specific or macroeconomic factors, and the recommendation was consistent with your stated risk tolerance and investment goals, that loss is typically considered a normal investment risk — not misconduct.

Haselkorn & Thibaut is direct with prospective clients: "If the S&P 500 went down and your portfolio went down with it, that is not a case." The legal system is not designed to insulate investors from the natural risks of market participation.

What You CAN Recover: Losses Caused by Broker Misconduct

The legal landscape changes dramatically, however, when losses are caused not by market forces — but by specific, identifiable acts of misconduct by a broker, financial advisor, or brokerage firm.

Under FINRA rules and Regulation Best Interest (Reg BI), financial advisors are legally obligated to recommend investments that are suitable for each individual client. When they fail to meet that standard — and clients suffer losses as a result — those clients may have powerful legal claims that can be pursued through FINRA arbitration.

Here are the most common scenarios that Haselkorn & Thibaut identifies as forming the basis of winnable cases:

Scenario 1: You Asked for "Safe" Income — And Got Alternative Investments Instead
This is one of the most common and legally actionable situations the firm encounters. An investor — often a retiree or near-retiree — tells their financial advisor they want safe, income-producing investments. They want capital preservation. They want to sleep at night. They explicitly say they cannot afford to lose their principal.

Instead, their advisor places them into high-commission alternative investments such as:

● GWG L Bonds — high-yield, speculative bonds issued by GWG Holdings, which filed for bankruptcy in April 2022, leaving thousands of investors with catastrophic losses

● Northstar Healthcare Income — a non-traded REIT that suspended distributions and saw its share value collapse, leaving investors with illiquid, near-worthless positions

● GPB Capital private placements — unregistered securities that are now the subject of widespread fraud allegations and regulatory action

● Inspired Healthcare Capital (IHC) — private placement offerings marketed as "stable" senior housing investments that ultimately failed

These products were routinely described to investors as "safe," "bond-like," or "just like a CD." In reality, they were speculative, illiquid, and entirely inappropriate for conservative investors seeking capital preservation. When these products failed, investors lost not just returns — they lost their principal.

Haselkorn & Thibaut has successfully represented investors in all of the above product categories, recovering millions of dollars through FINRA arbitration.

Scenario 2: Your Portfolio Was Dangerously Overconcentrated

Diversification is one of the most basic principles of sound investment management. When a financial advisor places a disproportionate percentage of a client's assets into a single product, sector, or strategy — particularly one that pays the advisor a high commission — it is known as overconcentration, and it is a recognized form of broker misconduct.

The firm has handled numerous cases in which retirees had 50%, 70%, or even 100% of their liquid net worth placed into a single alternative investment product. When that product failed, the financial devastation was total and irreversible. These cases, the firm notes, are among the most compelling in FINRA arbitration — because the overconcentration itself demonstrates a clear departure from reasonable investment management standards.

Scenario 3: The Risks Were Never Fully Disclosed

A financial advisor has a legal duty to provide clients with complete and accurate information about any investment they recommend — including the risks, fees, liquidity restrictions, and conflicts of interest involved. When an advisor describes a complex, high-risk product as "safe" or "guaranteed," omits the fact that the investment cannot be sold for years, or fails to disclose that they are earning a 7% to 10% upfront commission on the sale, they may be committing securities fraud.

Haselkorn & Thibaut has represented investors who were never told that their GWG L Bonds, non-traded REITs, or private placements were illiquid for years, that the issuing company was in financial distress, or that their advisor stood to earn tens of thousands of dollars in commissions from a single sale. These omissions and misrepresentations form the foundation of strong FINRA arbitration claims.

Scenario 4: Trades Were Made Without Your Knowledge or Approval

If your broker bought or sold investments in your account without your prior knowledge or consent — and you had not granted written discretionary authority — that is unauthorized trading, one of the clearest violations of FINRA rules. It does not matter whether the trades ultimately made or lost money. The act of trading without authorization is itself a violation, and it can support a claim for damages, disgorgement, and fees.

How FINRA Arbitration Works — And Why It Favors Investors

Most investors are surprised to learn that taking legal action against a financial advisor does not mean going to court. The vast majority of brokerage account agreements require disputes to be resolved through FINRA arbitration — a private, streamlined process that is faster, less expensive, and less formal than traditional litigation.

Through FINRA arbitration, investors can seek to recover lost principal, lost investment returns, interest, and in some cases attorneys' fees and costs. Cases are decided by a panel of arbitrators with financial industry expertise, and the process typically concludes far more quickly than a civil lawsuit.

Haselkorn & Thibaut regularly appears before FINRA arbitration panels on behalf of investors, as well as before the SEC, AAA, JAMS, and in state and federal courts nationwide.

How to Know If You Have a Winnable Case

According to Haselkorn & Thibaut, the investors most likely to have strong legal claims share several common characteristics:

● They were retired or near retirement and told their advisor they needed safe, income-producing investments

● They were placed into alternative investments, private placements, non-traded REITs, or structured notes without fully understanding the risks

● Their advisor earned high commissions on the products they were sold

● Their portfolio was heavily concentrated in one or two products that subsequently failed

● They received little or no written disclosure about the risks, fees, or liquidity restrictions of their investments

● Their losses significantly exceeded what the broader market experienced during the same period

If any of these circumstances apply, the firm urges investors to seek a free, confidential legal consultation before time limits on their claims expire.

Contact Haselkorn & Thibaut, P.A. by calling +1 888-885-7162