Alex Schmidt
  • Securities Law, Arbitration & Mediation, Criminal Law
  • New Jersey, New York
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Legal Knowledge
5.0/5.0
Legal Analysis
5.0/5.0
Communication Skills
5.0/5.0
Ethics and Professionalism
5.0/5.0
Rating: 10 Justia Lawyer Rating - 10 out of 10
Alex is a rising star in the areas of Securities Litigation and FINRA arbitration. He is a zealous advocate and meticulous in his preparation.
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Summary

Alex Schmidt worked in finance prior to attending to Fordham Law School. He obtained the Series 7 and 66 securities licenses and operated as a financial advisor specializing in asset allocation strategies with a focus on fixed income securities. Mr. Schmidt leveraged this experience in law school working in house at Oppenheimer as well as the law firm Bressler, Amery and Ross. While at Fordham in addition to serving as a Reservist in the US Army Military Police, Mr. Schmidt was also a member of the Fordham Law Securities Arbitration Clinic.

He presently specializes in securities and broker dealer law for both individual brokers and institutions, as well as individual customers. Mr. Schmidt's experiences in the securities industry as a broker and investment advisor have provided him with a unique insider perspective on essential aspects of customer disputes and investment fraud claims against broker dealers. His past work enables him to quickly ascertain whether a violation of FINRA rules or State or Federal Law has occurred. Mr. Schmidt also handles regulatory work for brokers and broker dealers. His regulatory practice includes brokers seeking U4/U5 reformation, expungement of their CRD's, as well as regulatory inquiries against brokers by securities regulatory agencies.

Practice Areas
  • Securities Law
  • Arbitration & Mediation
  • Criminal Law
Fees
  • Free Consultation
  • Credit Cards Accepted
  • Contingent Fees
Jurisdictions Admitted to Practice
New Jersey
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New York
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Languages
  • English: Spoken, Written
Education
Fordham University School of Law
J.D.
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Lafayette College
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Professional Associations
Hudson County Bar Association
- Current
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New Jersey State Bar
- Current
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Union County Bar Association
- Current
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SIFMA
- Current
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Certifications
Series 7
FINRA
Series 66
FINRA
Legal Answers
11 Questions Answered

Q. My broker disappeared after I discovered fraudulent misrepresentations associated with my account. Who do I sue if I
A: You may be able to file a claim against the broker dealer your broker was employed with. If your broker worked at a licensed broker dealer then certain claims you have against the broker can also be leveled against the brokerage firm in a FINRA arbitration. The brokerage firm may be responsible to pay the damages or investment losses in your account caused by the fraudulent activity if a panel of arbitrators concludes that fraudulent misrepresentation did in fact occur. If your broker was operating under his own auspices as an independent registered investment advisor things can become more problematic. Much will depend on whether the advisor was acting as anyone's agent when committing the fraud in your investment account. If your broker was operating completely independent under his own auspices you can still sue your missing broker but recovery of your lost assets will depend on a number of factors. To provide the best response more information is needed concerning your broker.
Q. I recently learned my stockbroker has been sued in the past and he never disclosed this. When I confronted him, he told
A: Whether a financial advisor registered with FINRA must report to his broker dealer or disclose on his brokercheck when they have” been sued” depends on 2 things: 1. The total settlement amount and whether the registered person was involved in an alleged sales practice violation 2. What the nature of your stockbrokers lawsuit consisted of? Much will depend on what the broker was being sued for. Whether named in the caption of the lawsuit or not, the registered person must report an arbitration or civil lawsuit on his or her Form U4 if the action pertained to violation of FINRA rules or “sales practice violations”. The Form U4 is the Uniform Application for Securities Industry Registration and has 15 different sections including information about brokers or registered representatives including disclosures about certain past lawsuits. Many other disclosures must be made that can be associated with lawsuits or being sued such as any judgment liens or filing for bankruptcy. In short more information will be needed concerning the nature of your financial advisors lawsuit in order to determine whether a disclosure should have been made.
Q. What does 'churning' mean in the context of investment fraud?
A: Churning in connection with investment fraud is simply when a customers investment advisor generates a high amount of trading activity in the customers investment account in order to collect more commissions. Churning is most commonly measured by checking the turnover ratio of the investment account. This formula measures the amount of trades in the investment account in a given time period relative to the total amount of assets being managed by the investment advisor. Churning is a violation of a FINRA and SEC rules as they pertain to the management of customer investment accounts. Churning violates FINRA Rule 2111 as a broker must believe an investment is suitable to a customers investment profile in order to enter a trade. Executing trades simply to obtain more commissions from a customer does not qualify as something suitable to an investors financial profile.
Q. My stockbroker was part of a Ponzi scheme and he subsequently filed for bankruptcy. Can I still recover money I lost
A: Even if your stockbroker has filed for bankruptcy you may still be able to recover investment assets lost in connection with the Ponzi scheme. If your stockbroker was licensed with a registered broker dealer then a FINRA arbitration could be commenced against the broker dealer and recovery of your lost investment assets could be made through that entity. If your stockbroker was operating as an independent advisor then recovery can be a little more of an issue. Much will depend on affiliations with other investment advisors that your stockbroker may have been working for as an agent. For instance, our lawfirm is presently involved in litigation against an investment advisor in connection with a Ponzi scheme. The investment advisor ran an LLC and operated an advisory as an independent but was also an agent for another investment advisor. Through this agent/principal relationship we were able to form a cause of action against the broker dealer for recovery of our clients lost assets connected with the Ponzi scheme.
Q. What agency would I complain to about the way my stockbroker is handling my account? I'm not sure if it's legal.
A: If you feel your investment account is being mismanaged you can report this to Financial Industry Regulatory Authority or ("FINRA"). This self-regulatory organization or ("SRO") oversees brokerdealers and sets compliance rules by which they must act. FINRA is where customer complaints against broker dealers for any type of misconduct are filed and FINRA rules and procedures set the terms by which they are adjudicated. The manner in which your complaint will be handled will really depend on the facts but a FINRA examiner will certainly be able to better assist you. If the FINRA examiner determines that misconduct did in fact occur, the brokerdealer at which your stockbroker works will be informed and a FINRA regulatory inquiry may in fact be opened. Next the examiner will tell you that you may - again depending on the facts - consider filing a separate customer complaint to recover investment losses. This customer complaint would be separate and independent of the FINRA regulatory inquiry and could be handled by you the investor on a pro se basis. FINRA rules and the manner in which a FINRA arbitration is conducted are fairly technical, so it would be beneficial to consider at that point, retaining an attorney who specializes in brokerdealer and securities law and is well versed in the FINRA Code of Arbitration Procedure.
Q. I'm trying to figure out if my "financial planner"
A: If your "financial planner" is a stockbroker who sells and markets stocks, bonds or other securities products, the easiest way to assess their certifications is checking the FINRA platform Brokercheck. Simply type in the brokers name and you will see what certifications the broker or "financial planner" has under the "Examinations" section of the platform. This will tell you if the financial planner has a Series 7 license which permits someone to sell or market securities products. Brokercheck will also contain other critical information relevant to the brokers qualifications such as the number of years affiliated with a broker dealer and what member firm the broker is affiliated with. The "Disclosures" section will show whether the broker has been involved in any past customer disputes or regulatory matters with FINRA the self regulatory organization which manages Brokercheck and overseas broker dealers. Your "financial planner" may not appear on Brokercheck if the individual was an accountant or works as a CFA or CFP. More information is needed on the financial planner in order to really assess what certifications they are required to have.
Q. I asked for documentation/filings from the
A: If you have the name of the company you can simply go onto the SEC platform known as EDGAR and enter the name of the company or its ticker. This SEC platform will contain a trove of data on the company at issue. As for the broker there is no regulation that I am aware of that mandates a stock broker to hand over filings covering a company. If you purchased a new publicly traded security then the broker is obligated to provide a prospectus covering the security. Of course, as a matter of good business practice your financial advisor should be responsive to your requests for information concerning a company you invested in. More information is needed however to determine whether the investment advisor was mandated to turn over requests for information.
Q. Do I have a claim for if there was also a general downturn in the market when I lost money?
A: You absolutely may still have a stockbroker fraud claim if their was a market downturn. Much will depend on the violation that you are alleging occurred whether it be fraud, misrepresentation, unsuitability or any number of potential violations. Your investment losses and whether you have sustained any are of course essential. Your financial profile and investment objectives which were stated to your financial advisor must also be considered. After the mass market loss following the Great Rescission of 2008 Individual investors still of course had valid claims for investment loss. The obvious defense of the broker dealers was that the market crash was completely unexpected and that the firm could not be blamed for an historic market downturn. The success of that defense and the strength of the investors claim to recover losses would depend on the factors listed above and arguments drafted by counsel.
Q. I've heard the rules are changing in protecting
A: There are rules in place protecting you against bad or unsuitable investments. FINRA suitability rules for instance require that any investment recommendation made by a broker to an investor must be in line with investors stated financial profile and objectives. What I think you might be referencing in terms of a rule change or what a broker has to tell you is the Department of Labor (DOL) Fiduciary Rule which was recently overturned by a Federal Court and is no longer being pushed by the Trump Administration. The DOL Fiduciary Rule may no longer be in place at the federal level but this doesn't necessarily limit what disclosers your broker has to make to you. Much will depend on where you are investing and if the firm has internal regulations still in place requiring certain disclosures to be made such as fees on certain products or material market events concerning securities in your account. Where you live and state securities regulations are also an important consideration. Whether you have a discretionary investment account or a commission based account is of great importance as well. Bottom line is what your broker has a duty to divulge is a fact sensitive inquiry. Much will depend on your investment profile and relationship with your broker or investment advisor in determining what has to be disclosed.
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Cranford, NJ, USA