ATTORNEY NEWSLETTER
FINRA, the national association of securities traders, has published new research on how financial abuse affects victims. The study aimed to look at financial fraud from the victim’s perspective, including their experiences, reactions, and the potential indirect financial costs and non-financial consequences of being defrauded.
The report issued by FINRA, the Financial Industry Regulatory Authority, covers indirect costs of being defrauded, both financial and other. Indirect financial costs include legal fees, fees for bounced checks, opportunity costs, and lost wages. The most common of these were late fees/interest, and bounced checks.
Nearly two-thirds of the study respondents reported experiencing at least one type of non-financial cost to a serious degree as a result of being victimized by financial fraud. Non-financial costs included stress, depression, frustration, anger, other psychological consequences, sleep deprivation, health issues, and lost time. Stress was the most commonly reported non-financial cost, with 50 percent of respondents reporting suffering from severe stress as a result of being defrauded. Additionally, nearly half of financial fraud victims who responded to this study reported feeling personally responsible for the incident. Anger was the most-reported emotional response, with 74% of respondents reporting feeling this emotion after the fraud incident.
The study also looked at how the financial fraud occurred, and how the victim experienced it. Only 35% of study respondents reported the incident. Very few respondents (15%) reported having a great deal of interaction with the person or entity they were defrauded by.
Evans Law Firm, Inc., has offices in Los Angeles, Sonoma, and San Francisco, and handles all types of financial fraud cases including FINRA arbitrations involving securities, investment fraud, variable annuities, insurance and stock broker fraud and other types of financial/investment fraud. If you have been a victim of financial fraud, please contact Evans Law Firm, Inc. at 415-441-8669 or via email at info@evanslaw.com.
