Third-party asset recovery companies advertise directly to investors known to be victims of investment fraud. A third-party asset recovery company gathers information regarding scams after they have become public, and targets the investors of those scams offering recovery services. According to the North American Securities Administrators Association (NASAA), these firms employ high pressure sales tactics to get the investor to spend as much as $10,000 to hire the company. But investors risk becoming victimized a second time. See NASAA’s Informed Investor Advisory: Third-Party Asset Recovery Companies here.
In addition to NASAA’s warning, the U.S. Securities and Exchange Commission issued an Investor Alert titled “What You Should Know About Asset Recovery Companies” advising investors to be wary. The SEC described the services such companies provide for sometimes thousands of dollars as things that investors could do easily on their own (reporting fraud to state and federal securities regulators), and performing useless services (sending demand letters to the original fraudster or company that may already be insolvent). See the SEC Alert here.
Unfortunately, these companies often cannot provide legal expertise to fully advise investors as to all of their potential remedies, compile only cursory information regarding the fraudulent company that is publicly available, lodge basic complaints with state securities regulators that investors can do themselves at no cost, and are given false hope of recovering lost investments when any recovery is unlikely or impossible to persuade them to pay hundreds or even thousands of dollars in fees.
There is no substitute for the expert legal and factual analysis that an experienced securities attorney can provide. Jones & Keller, P.C. performs a thorough analysis before making any recommendation to take any action to recover investment losses. Specifically, we examine the nature of the investment, whether the investor has legitimate legal claims, the potential litigation forums available (courts or arbitration), what parties may have liability for the loss, and the likelihood of recovering on a potential judgment. Each of these factors is critical to determine whether to spend any money or effort pursuing a claim to avoid throwing good money after bad. Jones & Keller, P.C. has extensive experience in bringing claims on behalf of investors, and offers investors who have suffered investment losses a free consultation to perform this analysis.
This communication is provided for your information only and is not intended to constitute legal advice or legal opinion as to any particular situation. You should not take, or refrain from taking, any action based on information in this article, without seeking legal counsel from an attorney on your particular facts and circumstances. Jones & Keller would be happy to provide you with specific advice about particular situations, if desired. Do not hesitate to contact us.[/et_pb_text]