The Financial Industry Regulatory Authority, Inc. (FINRA) is a private corporation that acts as a self-regulatory organization (SRO). FINRA is the successor to the National Association of Securities Dealers, Inc. (NASD) and the member regulation, enforcement and arbitration operations of the New York Stock Exchange. It is a non-governmental and self-regulatory organization that performs financial regulation of member brokerage firms and exchange markets.
FINRA operates the largest dispute resolution forum in the securities industry to assist in the monetary and business dispute resolution between and among investors, brokerage firms, and individual brokers.
About FINRA Arbitration
FINRA operates the largest arbitration forum in United States for dispute resolution between customer and member firms, as well as between brokerage firm employees and their firms. Virtually all investor and stockbroker agreements include mandatory arbitration agreements, whereby investors and their brokerage firms waive their right to trial in a court of law. While arbitration cases are the usual last resort resolution procedure, class action cases are often brought and permitted to go forward in courts as well, where binding arbitration contracts are sometimes rejected, typically after an unconscionable rule.
Duty to Arbitrate
Customers are bound to FINRA arbitration by contract. Registered representatives and their firms are contractually bound to arbitrate their disputes by their membership in FINRA, formerly the NASD. The broker-dealer and the stockbroker, upon applying for membership in the FINRA, agree to be bound by the rules of FINRA.
Commencing an Arbitration
Arbitrations are commenced by filing a Statement of Claim within the applicable arbitration forum with a submission agreement and the required filing fees. FINRA fees can range from $475 to $1800 depending on the amount in controversy. An initial damage analysis may be performed by a forensic accountant prior to filing the Statement of Claim. Depending on the case’s nature, a pre-litigation damage analysis may not be necessary.
If you have lost money as a result of securities fraud you may be able to recover your financial losses. The Law Offices of Place & Hanley, LLC is dedicated to helping investors. We are dedicated to protecting investor rights and we offer free consultations. If you’ve been a victim of pursuing FINRA arbitration, contact Place & Hanley, LLC at 866-318-4725.