What Is the Difference Between Forgery, Conversion, and Theft? - Transcript

Forgery, conversion, and theft are serious offenses that often arise in securities disputes, causing significant harm to investors and clients. At Malecki Law, our New York securities lawyers focus on protecting the rights of plaintiffs who have been victimized by financial misconduct, ensuring their cases are pursued with diligence and care.

Forgery involves creating, altering, or using false documents or signatures with the intent to deceive or defraud. In the securities industry, this can manifest in cases where brokers or financial professionals falsify client signatures, alter transaction documents, or fabricate account statements to cover up unauthorized activity.

For example, a broker may forge a client's signature to approve a high-risk trade or withdraw funds without authorization. Such actions can lead to significant financial losses and erode the trust between investors and their financial representatives. The intent behind forgery is usually to deceive for personal or professional gain, making it a critical violation of securities law.

At Malecki Law, we understand the complexities of proving forgery and work closely with clients to gather evidence, assess the extent of harm, and pursue appropriate remedies. Forgery in the financial sector not only impacts individual clients but also undermines the integrity of the entire market, making it essential to hold wrongdoers accountable.

Conversion occurs when someone lawfully possesses another person's property but then misuses it in a way that violates the owner’s rights. In securities disputes, conversion often involves financial professionals misappropriating client funds or assets for unauthorized purposes, such as diverting money to personal accounts or using investments to benefit themselves or others.

Unlike theft, conversion usually begins with the lawful possession of property. For example, a broker might have access to a client’s account for legitimate purposes but later misuse those funds in ways that harm the client. This betrayal of trust can lead to financial ruin for investors, particularly when large sums are involved. This situation might also arise when a Power of Attorney who has access to trade in the principal’s accounts, puts their interests ahead of the principal, and begins to divert funds to their own personal accounts.

Malecki Law has extensive experience handling cases of conversion, helping clients recover lost funds and holding financial professionals accountable. We take the time to understand the details of each case, ensuring every instance of misconduct is addressed and fairness is pursued.

Theft involves the outright taking of property without the owner’s consent and with the intent to permanently deprive the owner of it. In the context of securities law, theft often includes embezzlement, unauthorized withdrawals, or misappropriation of funds from client accounts.

For example, a financial advisor who removes money from a client’s account without their knowledge or approval commits theft. Such acts not only cause direct financial harm but also violate the fiduciary duty owed to clients. Theft is a blatant act of misconduct that requires immediate legal action to prevent further losses and secure justice for the victim.

Malecki Law is dedicated to representing clients who have been victims of theft in the securities industry. By thoroughly investigating the facts and leveraging years of legal experience, our attorneys work tirelessly to recover what has been wrongfully taken and ensure accountability for the perpetrators.

If you’ve been a victim of forgery, conversion, or theft in the securities industry, it’s essential to act quickly to protect your financial interests. At Malecki Law, our attorneys have over 20 years of experience representing plaintiffs in securities fraud cases, including FINRA arbitrations, litigations, and whistleblower claims. We are committed to holding wrongdoers accountable and helping clients recover their losses.

Call us today at 212-943-1233 to speak with a New York securities law attorney, or complete the firm’s confidential online contact form to schedule a consultation. Your future is our business, and we are here to fight for your rights.

“Is typically a tool used in conversion and Theft there are three different causes of action but usually are all involved in the same cases somebody has stolen money or property from you and they’ve used forgery or false identity in order to do so.”