New York, NY securities attorney Jenice L. Malecki talks about defective securities and proprietary investment cases. She states that defective securities are investments that are inherently unsuitable for any investor. These securities are often structured or modeled in ways that fail to perform as intended, yet they are sold under misleading assumptions. Essentially, these are a type of fraud case: the company issuing the securities knew they would not function as promised, yet marketed them as if they would. The core issue is that the product does not operate as designed and was misrepresented to investors, making it a defective security.