Over $500K Awarded to HLBS Law Clients Due to Defamation and Inaccurate Form U-5 Filing by Firm

Arbitration Victory & Expungement For Financial Advisor Team vs. Broker Dealer

A financial advisor team was terminated by their broker-dealer in 2021. Upon termination, the firm filed a termination disclosure on the advisors’ Form U-5, making various allegations of misconduct. The Form U-5 language was then reported to the advisors’ Central Registration Depository (“CRD”) and BrokerCheck records where it was visible to the world. As a result of the disclosure and the firm’s conduct, the advisors’ business and reputation unnecessarily suffered. The advisors argued that there was no merit to the firms’ claims and filed for arbitration.

Michael Bessette, an attorney at HLBS Law, represented the advisors in arbitration and was able to secure a major victory for the advisors’ team. The arbitration panel ultimately awarded the advisors over $500,000 in damages, costs, and fees, and also ordered expungement of the termination disclosure due to the defamatory nature of the language. Bessette hopes this case reminds firms of the responsibility of providing the public with truthful and accurate information when filing Form U-5s.

If you have been harmed by a firm’s Form U-5 filing or need legal assistance, please contact us today for a consultation to ensure you have the best chance of recovering your reputation.