Investors usually sign away their right to a trial by jury when they open a brokerage account. Brokerage firms require their customers to sign agreements requiring them to arbitrate any disputes before the Financial Industry Regulatory Authority (FINRA). FINRA is authorized by Congress to protect investors, maintain securities market integrity, and resolve disputes between member brokerage firms and their customers.
FINRA operates the largest securities dispute resolution forum in the United States, and its resolution of disputes among investors, brokerage firms and individual brokers is accomplished through two non-judicial proceedings: arbitration and mediation.
Investors can file a claim through FINRA when they have a dispute involving the business activities of a brokerage firm or one of its brokers. To be considered, the alleged act resulting in a claim must have taken place within the past six years.
If you have a securities dispute and want to recover money or securities, filing an arbitration or mediation case offers you a way to seek damages.
How Does the Arbitration Process Work?
Arbitration is a formal alternative to going to court in which two or more parties select a neutral third party, called an arbitration panel, to resolve a dispute.
Arbitration panels, which can consist of one or three arbitrators who are selected by the parties, will listen to the arguments, study testimonial and evidence, and then make a decision.
How the arbitration process works will depend on the size of the claim. Claims larger than $100,000 will require an in-person hearing decided by a panel of three, and smaller claims will be decided by one arbitrator.
The arbitration panel’s decision, which is called an award, is final and binding. According to FINRA, it can take up to 16 months for an award to be determined when an arbitration case goes to a hearing.
Hire Experienced Arbitration Attorneys
If you have an investment dispute, you should consider hiring an attorney to represent you during the arbitration or mediation proceedings.
FINRA states its arbitration process is a neutral forum for claims resolution; however, arbitration panels can often have industry biases. For this reason, investors need to hire the right attorney with the necessary resources to fight back against powerful financial interests.
The securities and investment attorneys at the Morgan & Morgan Business Trial Group handle all investment cases on a contingency fee basis, which means that you pay no fees unless we recover money for you. Our at
Whether in court or in arbitration, rest assured that we have the resources and experience to battle against the nation’s largest brokerage firms, investment advisory firms, and banks.
Our attorneys are supported by the size and skill of the largest contingency law firm in the nation – with more than 700 lawyers and offices across the country.
Contact us for a free case review.