FINRA Arbitration Process
Virtually all agreements between investors and their financial advisors include mandatory arbitration agreements, whereby investors and the financial advisors, waive their right to trial in a court of law.
For clients with brokerage accounts at FINRA regulated firms, their arbitration agreements typically direct the claim to FINRA’s arbitration forum – FINRA Dispute Resolution. The arbitration process is outlined below:
Initial Consultation and Evaluate Claim
File a Claim
Answer a Claim
Decision & Awards
For clients with accounts held at Registered Investment Advisors, the Investment Advisory Agreement typically dictates which arbitration forum will adjudicate the dispute (i.e., American Arbitration Association, Judicial Arbitration and Mediation Service, National Arbitration and Mediation, etc.) The process is similar to FINRA arbitration, however, each forum typically has its own set of procedures.
For clients who do not have arbitration agreements, or for those who invested money with someone not regulated by FINRA or a Registered Investment Advisors, they can file suit in state or federal court (depend largely on the investments at issue, amounts in dispute and the location of the parties). The litigation process in state or federal court typically moves at a slower pace and involves added discovery obligations.
We take cases on a contingency fee basis, which means we do not collect a fee unless we recover for you. Please contact our office to discuss your case.
*In some litigated matters, we advance costs and expenses related to the litigation. In these situations, the advanced costs and expenses are recovered from the gross recovery of any verdict or settlement.