For any business in California to survive and make the necessary profits, there must be a great deal of trust among founders, partners, managers and employees. When someone breaches their duty of loyalty and care they owe others, the business is likely to suffer a great deal. Take a look at some of the types of fiduciary negligence that can occur and what you can do about them.
Fiduciary negligence in California
Fiduciary negligence is among the top white-collar crimes in the country. It involves someone who is legally trusted by other people to act on their behalf breaching their fiduciary duty to another party. Fiduciary duty is a legal term that refers to the highest standard of care that one person owes another.
Common types of fiduciary negligence
- Financial mismanagement: This occurs when a fiduciary fails to manage the finances of another party responsibly. This can include making poor investment decisions, mishandling funds or not providing adequate oversight.
- Breach of confidentiality: This happens when a fiduciary breaches their duty of confidentiality and discloses confidential information to unauthorized individuals. Breach of confidentiality includes sharing sensitive information with competitors or using private information for personal gain.
- Negligent supervision: Negligent supervision occurs when a fiduciary fails to supervise employees or agents adequately. This can lead to financial losses, wrongful transactions or other damages.
- Improper investment decisions: This occurs when a fiduciary makes poor investment decisions that result in financial losses for the other party. For example, they invest in high-risk ventures or make unauthorized investments.
If you are a victim of fiduciary negligence, gather sufficient evidence to support your claim, assess your legal options and determine if you have a valid case. Fiduciary breaches can be complicated, and it is important to make sure that you fully understand your rights and options before taking any action.