In the U.S., the Securities and Exchange Commission (SEC) does its best to protect investors from being cheated. To do so, it keeps a close eye on the work of investment professionals as well as the investments themselves. However, the extent to which professionals can be held liable for the guidance they give depends on the circumstances under which they do it.
To decide whether the investment professional should be held liable for his or her advice, the SEC will try to determine whether the investment advice was suitable for the client and whether the professional, bound to a fiduciary duty, acted in the client's best interests. To be as precise and concrete as possible in defining your "best interests," a professional who is hired to offer you advice should ask you for some documentation that outlines your risk profile and investment goals. Then, he or she is duty-bound to help you ensure that your investment choices remain consistent with your profile and goals.
If you act on any investment advice that you believe caused you losses because it was inappropriate according to your risk profile and investment goals, you should immediately contact the professional who gave you the advice, his or her company and the SEC (all in writing). For you to have a chance of being compensated for what you lost, you must prove that the broker's suggestions were not within the specifications included in your risk profile and investment goals, and that you were not made properly aware of the financial risks involved. If the investment was in fact in line with your profile, or if your broker fully explained to you what the risks were and you invested anyway, the financial professional is typically not liable for your losses. Remember that, although brokers and financial planners must act in your best interests, they cannot control market movements or reverse the risk/reward tradeoff, so you can't blame them for all your losses.
To read more about financial advisors, see Find The Right Financial Advisor, Choosing An Advisor: Wall Street Vs Main Street and Tips For Resolving Disputes With Your Financial Advisor.