Although most cases of stockbroker and investment fraud may be difficult to detect, there are measures investors can take to minimize their chances of becoming a victim.
Educate yourself on investments and how the stock market works.
Follow stock market activity and your specific investments closely. Be aware of actions that affect companies you've invested in, like mergers or reorganizations.
Seek outside sources for additional information or opinions on potential investments.
Track your own account activity. Make sure to save all records of your investment activity.
Get to know the ins and outs of risk. Do not blindly invest without studying risk. Acknowledge which investments carry greater risk and make sure you know what is at stake when deciding to invest.
Trust your instincts. If your broker is leading you into an investment you are uncomfortable with, you should be cautious and make decisions only after you fully understand the risks.
Realize that security investments are not insured against loss.
Do not invest more money in the stock market than you can afford to lose!
Read over your statements closely and verify all activity.
Make sure the trades listed on your account are confirmed, and that the prices are correct.