Brokerage firms and brokers have affirmative obligations to truthfully disclose material facts concerning themselves, and the investments or strategies recommended to clients. Such material facts can include risk factors of the investment, returns expected from the investment, time horizons of the investment, the truth about company executives or company track record and more.

Material omissions can be as devastating as misrepresentations. Disclosure of “half-truths” concerning material facts does not suffice. The failure to provide all material information to the customer constitutes a material omission and often evidences securities fraud or violations.

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