Stockbroker fraud is a catch – all term used to describe not only fraud in the traditional sense such as theft and Ponzi schemes, but other wrongdoing such as misrepresentations, omissions and gross negligence.

Two common elements in all the different types of conduct that fall under the stockbroker fraud umbrella are the elements of trust and reliance. Stockbroker fraud cannot take place unless there is reliance and trust on the part of the client. These are manifest in the client trusting that the broker is acting in the clients’ best interest and trusting them with little or no question to what the broker is telling them.