How Do I Sue My Broker For Investment Losses in FINRA Arbitration?

This page explains how the FINRA arbitration works, the steps involved in filing a FINRA lawsuit against a broker, and why hiring seasoned FINRA attorneys can maximize your chances for a full financial recovery.

Disputes between investors and their stockbrokers cannot be resolved by going to court. You can sue your broker for your investment losses in Financial Industry Regulatory Authority (FINRA) arbitration.

This is the neutral forum provided by the FINRA where disputes between investors and their broker-dealers/brokers are decided by a panel of arbitrators. The panel will hear both sides, examine the evidence, and issue a ruling on the case.

When you signed paperwork agreeing to work with your broker, this included an arbitration clause. By signing, you consented to resolve any disputes with the financial advisor or the firm in FINRA arbitration.

Arbitration clauses are legal and binding. This means you cannot take your case against your broker to court.

Find out more on our FINRA Arbitration FAQs page.

This is not the kind of legal claim you want to make without a trusted securities law firm representing you and protecting your legal rights.

• Initial case assessment.
• Explore your legal options.
• Decide next steps.

· You want an investment loss recovery attorney specialist who has decades of experience securing awards and settlements against FINRA brokerage firms.

· It is also beneficial if the lawyer exclusively focuses on representing investors against brokerage firms—not that there's anything wrong with securities lawyers specializing in those fields. Some attorneys represent both investors and brokerage firms, which is not encouraged.

• If you hire Shepherd Smith Edwards and Kantas (investorlawyers.com), we will guide you through the entire process, gather evidence to build your case, and provide you with specialized securities representation.
• Our proven FINRA arbitration attorneys will handle all discovery, filings, deadlines, and all communications with the brokerage firm and their lawyers.
• We will represent you at the FINRA arbitration hearing.

As your FINRA lawyers, we will file your claim in FINRA arbitration.

A Statement of Claim is a document or pleading that states:

• The facts and allegations of your case.
• The damages you are seeking from your broker and/or their firm.
• The reasons you are suing for financial recovery.

A Statement of Claim explains your side of the story and includes any supporting documents. Drafting a Statement of Claim requires skill, experience, and nuance. Hiring a well-respected FINRA recovery lawyer creates an optimum impact on the arbitrators.

After you file your Statement of claim, the brokerage firm you are suing gets to respond with its “Answer.”

• Brokers, when you sue them, start seeing you as an adversary and no longer as their client.
• Broker-dealers usually have highly trained investment attorneys to represent them and they will know how to twist the facts and blame you.
• Hiring a knowledgeable FINRA law firm means you have representation protecting you and advocating for your interests and case.

You may have grounds for a FINRA lawsuit if:

• Your financial advisor recommended too risky, unsuitable investments.
• Your brokerage account was overconcentrated with too many of the same products.
• The risks involved were not fully disclosed to you.
• Your broker-dealer employed an investment strategy that was not in your best interests.

If any of this has happened, there is a good chance you qualify to file a FINRA arbitration claim against your stockbroker. Find out today.

• Narrowing down the arbitrator list.

FINRA will give your broker fraud attorney a list of arbitrators from which they can select, prioritize, and eliminate any names. Your securities counsel should know who these arbitrators are so they can make such determinations.

• Choosing the final arbitration panel.

Who presides over your case will come from the culled lists submitted by both your FINRA attorney and the legal representation for the brokerage firm.

An Initial Prehearing Conference (IPHC), usually by video conference, will take place to set the arbitration hearing date, as well as the deadlines for discovery and the different motions.

Before the FINRA arbitration hearing, both sides will discuss the possibility of reaching a settlement or if mediation would be beneficial.

Discovery is the exchange of documents and information between parties: Primary exchanges for Discovery will have taken place before the IPHC. In-depth Discovery usually happens after the IPHC and before any hearing dates.

A well informed FINRA lawyer should understand how the discovery process works and how to guide your claim through while handling any discussions with your broker’s legal representation.

• Contact Our Trusted FINRA Attorneys
• Free Consultation. Find Out Whether You Have A FINRA Claim.
• We’ve Secured Awards and Settlements for Thousands of Investors.
• No Recovery? You Don’t Pay Us Any Fees.

The hearing process for most broker misconduct cases usually last a few days, but they can also go on for a couple of weeks. The hearing usually happens in a conference center or at a FINRA office closest to where the investor, who is the claimant, lives.

• Opening statements from both the claimant (the investor/customer) and the respondent (the broker-dealer and/or financial advisor
• Examinations and cross examinations
• Any objections
• Closing arguments

The ruling and any award to the claimant can be announced up to a month after the FINRA arbitration hearing concludes.

• There is very limited right to appeal.
• Decisions made by the panel are binding, and in nearly all cases final.

Based on its examination of evidence and legal principles, the FINRA arbitration panel will determine whether to award the claimant:

• A full award for all damages sought.
• A partial award, because that is what the FINRA panel determines the investor is owed, some of the charges against the respondent were dismissed, or the investor/claimant was found partially liable.
• A larger award than what the claimant requested because the FINRA panel found there to be egregious conduct and decided to grant punitive damages.
• No award. Called a denial of claim, this is when the arbitration panel determines that the claimant did not prove that the respondent was liable or owed damages.

The majority of investors represented by Shepherd Smith Edwards and Kantas have received awards or settlements.

• The respondent has thirty dates to pay.
• A failure to pay on time can lead to suspension from FINRA. Suspended firms are prohibited from selling securities until they pay the award.

• A settlement is an agreement that can be reached between both parties at any time before a final award is granted.
• Settlements are usually arrived at in mediation and include monetary compensation for the claimant.

• Decades of experience with FINRA arbitration and how to make it work for you.
• Skilled FINRA lawyers that have helped thousands of investors to secure awards and settlements.
• Knowledgeable about the securities law strategies that will maximize your chances for a full financial recovery.

More than 90% of our clients have secured full or partial financial recovery.

• Your first case evaluation with one of our knowledgeable FINRA arbitration attorneys is a free, no obligation assessment.
• Because we work on a contingency basis you will only pay for our legal representation if we win an award or settlement for you.

Call (800) 259-9010 or fill out this online contact form today.