FINRA Arbitrations

FINRA Arbitration Attorney

Our attorneys have extensive experience handing arbitrations before the Financial Industry Regulatory Authority, or FINRA.   As an investor, you may depend on an investment broker or investment firm to professionally handle your investments. By hiring a securities professional and paying them fees to manage your investment interest, you can expect that your assets are directed in a caring and fair manner.  Unfortunately, there are circumstances when you feel that your financial assets are being mishandled by the financial professional you hired. In these circumstances, you need an experienced securities lawyer to represent your FINRA Arbitration Claim. 

Active FINRA Complaint Investigations

We are currently investigating complaints against the following broker-dealers: LPL FinancialNational Securities CorporationUBS FinancialWells Fargo AdvisorsRobinhoodRoyal Alliance AssociatesSteifel Nicholas and Oppenheimer.  If you or someone you know lost money investing with any of these firms or have complaints, please call us for a free and confidential consultation at 212-203-9300.

FINRA Arbitration News

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What is the FINRA Arbitration Claim?

A FINRA Arbitration Claim applies when an investor asks a FINRA Dispute Resolution Panel to resolve their dispute against a securities broker or brokerage firm for the mishandling of their investments.  To initiate this process, an investor can file for an arbitration claim or request mediation through FINRA if they feel their money or investment is being mishandled by a brokerage firm or one of its broker agents. However, the violation must have happened within the past six years for the FINRA Arbitration Claim to be valid. 

What Are The Damages Available Through FINRA Arbitration?

As with any litigation, damages are sought by the claimant from the respondent. Under the FINRA Arbitration Claim, the following damages are available to the claimant: 

FINRA-Arbitration

Actual Damages

Actual damages or compensatory damages refer to the monetary sum ordered to compensate the claimant for their loss. These types of losses may include, but are not limited to:

  • Net Out of Pocket Losses: This refers to the claimant’s net out-of-pocket losses that the FINRA panel’s assessment of the claim and evidence presented.  
  • Benefit of the Bargain: This refers to the claimant’s expected value of their investment.  
  • A Well-Managed Portfolio Account: This is the difference between what the claimant’s account made or lost due to the respondent’s mishandling, in contrast to that of a well-managed portfolio that the claimant would have had in the same time frame.

Statutory Damages

Statutory damages apply if a claim by the investors is based on a statute. Here, the damages are based on what the law requires and how the damages are to be calculated. 

Recission

Rescission is the term to put the claimant’s financial situation before the respondent’s wrongful transaction. This remedy may mean that the broker or the brokerage may be ordered to return the securities at issue to the claimant. 

Disgorgement

Disgorgement is when the FINRA Arbitration panel ordered the respondent to disgorge the profits or commissions they made from the claimant. This damage aims to make the wrongful acts unprofitable for the respondent to discourage brokers and brokerage firms from committing these acts. This type of damage may even be ordered by the panel even if the claimant did not suffer any net out-of-pocket losses. 

Specific Performance

Specific performance applies when the FINRA Arbitration panel requires that the respondent fulfill their legal or contractual obligation to the claimant if it is determined that monetary damages alone are inadequate to remedy the wrongdoing of the respondent. 

Punitive Damages

Punitive damages are awarded to penalize the respondent for the severe misconduct that they had committed. The standard for awarding punitive damages varies by state and jurisdiction. 

Litigation Costs

Generally, arbitration cases involving securities include litigation expenses not limited to filing fees, copy costs, hearing costs, and other related administrative and substantive legal costs. Typically, winning parties ask litigation costs incurred in the FINRA Arbitration Claim to be reimbursed by the losing party. 

Requests to Include Interest as Part of the Award

This type of remedy applies if a party explicitly requests that the FINRA Arbitration Panel include interest as part of the award. To award this to the claimant, the panel considers the following issues: 

  • A statutory or contractual basis that allows interest to be awarded; 
  • Amount of or rate interest; 
  • Date interest begins; and 
  • Date interest ends.

The interest rate to be applied in the calculation of the damages varies by jurisdiction and case. The basis for interest rates can range from those required explicitly by the states, the Internal Revenue Service rates, treasuring bills, or the broker’s interest rates to its customers for outstanding debts. Regarding the date on when the interest rates are to be applied, arbitrators generally apply the interest rate from the date of the contract was breached or the time that the panel determined that a debt is due or payable.