FINRA, or The Financial Industry Regulatory Authority, regulates and provides regulatory oversight for most of the securities industry, including broker-dealers, registered representatives, and investment firms. FINRA does not regulate Registered Investment Advisors. FINRA is in turn subject to oversight from the Securities and Exchange Commission (SEC). FINRA is operated and funded by the securities industry.
Most investors will find that their securities arbitration firm, and that firm’s financial advisors, are members of FINRA. Investors should know that when opening an account with a FINRA registered firm, they will be asked to sign an opening agreement that contains a provision that requires all disputes that may arise between the investor, the firm, and/or advisor must be resolved through FINRA arbitration conducted with the Code of Arbitration Procedure for Customer Disputes.
FINRA Arbitration, conducted by FINRA Arbitration attorneys, is initiated with filing a Statement of Claim, like a Complaint in state or federal court, setting out the claims of the investor, which generally include FINRA Arbitration claims for monetary damages arising from the mishandling of the investor’s account. The investment firm’s law firm then responds with an answer, essentially rebutting the investor’s claims and protecting them from securities fraud.
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FINRA then provides the parties with a list of potential arbitrators. Depending on the significance of the arbitration claim, there will be one or three arbitrators. The parties then rank the arbitrators. All the prior awards of the potential panel members are available the FINRA website, which is very helpful in the ranking process. A panel is determined by FINRA. Arbitration provides the advantage of generally resolving the dispute quicker than a court case with less discovery required and most often lower costs.
Once the Panel has been determined, the Panel and the parties decide on a hearing date and other issues at what is referred to as an Initial Pre-hearing Conference. The arbitration itself is conducted like a more casual court trial with a FINRA Arbitration lawyer. Witnesses are sworn in and the lawyers for both sides are entitled to question the witnesses. The Panel members can also question the witnesses. The hearings generally take place in a conference room in one of the cities in which FINRA has a hearing site. FINRA has at least one hearing site in every state, generally in the largest cities in the state. Veach Legal has handled FINRA arbitration procedures throughout the country.
When financial loss hits, every day without legal counsel costs you more. Veach Law PLLC has been fighting for investors since 1983, recovering losses caused by securities fraud, broker misconduct, and investment disputes. Reach out to our attorney’s office today.
After uncovering research misconduct within my organization that tied directly to investor harm, I needed an attorney who understood the legal and scientific sides of the issue. Attorneys at Veach Law PLLC handled everything with professionalism.
I discovered that critical information about my portfolio had not been accurately represented to me for years. Tucker Veach, Attorney, and his team investigated the fraud case thoroughly and secured a result I didn’t think was possible.
Veach Law PLLC took on my broker misconduct case when no one else would. Tucker Veach understood the financial loss I had suffered and fought hard through FINRA arbitration to recover what I was owed. I finally felt like someone was in my corner.
Dealing with a broker who falsified data or a situation involving the manipulation of research materials? You deserve clear answers. Reach out to Tucker Veach Attorney for a direct conversation about your rights and your options for recovery.
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A: The four main types are debt securities, derivative securities, equity securities, and hybrid securities.
A: The seven common types are insurance fraud, securities fraud, tax fraud, identity theft, wire fraud, mortgage fraud, and research fraud.
A: Brokers are held to a professional standard. If a mistake results in financial loss, the broker or their firm may be held liable through legal action or FINRA arbitration.