Effective resolution of legal disputes
Arbitration has emerged as a popular method for resolving legal disputes, providing a more efficient and cost-effective alternative to traditional litigation. With arbitration, clients can avoid a public court case and settle disputes privately. Arbitration is a forum in which legal claims are resolved outside of a traditional courtroom.
The Financial Industry Regulatory Authority (FINRA) arbitration process is particularly important. FINRA, as a self-regulatory organization, oversees arbitration disputes involving broker-dealers, registered representatives, and investors. However, FINRA isn’t the only type of arbitration clients can face.
HLBS Law works with clients facing FINRA arbitration as well as other types of arbitration to successfully resolve disputes without going to court.
Types of Legal Claims in Arbitration
There are different types of legal claims made in arbitration, including:
Breach of Contract
Breach of Fiduciary Duty
Business Disputes
Excessive Fees and Commissions
Improper Use of Discretion in a Discretionary Account
Failure to Follow Instructions
Fraud or Theft
Misrepresentation
Suitability
Unauthorized Trading
Arbitration Services
Streamlined and efficient process
Arbitration is a method of alternative dispute resolution that involves the impartial resolution of legal conflicts outside of traditional courtrooms. Arbitration provides a streamlined and efficient process to resolve disputes related to securities, investments, and regulatory issues.
Avoid lengthy and costly litigation
By choosing arbitration, financial advisors or financial firms can avoid lengthy and costly litigation while still ensuring a fair and impartial resolution to their legal matters. Working with a skilled financial attorney experienced in navigating the arbitration process is crucial to protecting your rights and interests as a financial advisor or financial firms.
Experienced legal team
HLBS Law has extensive experience handling claims brought against our clients or filed on behalf of our clients through arbitration. There are several arbitration forums in which claims can be resolved. Whether you are facing a legal claim that is filed in FINRA, JAMS, or AAA arbitration, our experienced legal team can assist you through this process.
Individual approach
While each case is unique and depends on the facts and circumstances of our clients, HLBS Law is prepared to go all the way to the final hearing and litigate for our clients. During your consultation, we will discuss your case and your options to decide the best course of action.
Frequently Asked Questions
What is FINRA arbitration?
FINRA arbitration is the largest dispute resolution program in the country for financial advisors and is tied to your U4. The FINRA Code provides the rules and procedures for FINRA arbitration. Decisions in arbitration are rendered by a panel of neutral arbitrators selected by the parties. Most arbitrations are resolved by settlement.
What happens if I am named in an arbitration case?
If you are a financial advisor and are named in an arbitration, you are being accused of misconduct or wrongdoing related to securities transactions or investments. Upon receiving notice, it’s crucial to engage an attorney familiar with the rules and procedures of the arbitration forum, whether it be FINRA, JAMS, or AAA.
At HLBS Law, we help you understand the allegations, gather evidence to support your defense, and represent your interests throughout the arbitration process. Depending on the outcome of the arbitration, potential consequences may include financial penalties, restitution payments, or other disciplinary actions. It’s crucial to take the allegations seriously and work closely with your attorney to navigate the arbitration proceedings effectively.
How long do I have to respond to a Statement of Claim (SOC) filed in FINRA arbitration?
The FINRA code usually allows a 45-day window to file a Statement of Answer (SOA). The SOA provides a response and defense to the allegations made in the SOC. In addition, you can also make counterclaims against the SOC filer, if applicable. This 45-day window allows you a reasonable amount of time to retain counsel. The 45-day window can be extended with an extension agreed upon by both parties.
What if my firm offers to have the firm attorney represent me?
Be very careful in this situation. A firm lawyer will have the firm’s best interest in mind, even if that firm’s best interest is not your best interest. We have seen several instances where a firm will opt to settle a matter, and the settlement is only disclosed on your BrokerCheck by FINRA. This results in you being harmed by the firm attorney. While it may cost more, HLBS recommends you consult with independent counsel on this decision.
What is my duty to my employer if I am named in a FINRA arbitration?
In the rare instance in which you are individually named in a FINRA arbitration, you are usually required to report it to your employer based on firm policy. In addition, regulatory requirements require you to report or update your Form U4 based on certain complaints, allegations, and lawsuits filed against you. Consult with your firm’s compliance department or counsel when reporting.
What happens if I am named in a different arbitration forum, such as AAA or JAMS?
HLBS Law has experience in these arbitration forums as well. The rules in these forums are, in general, like those for FINRA arbitration. Response times and other procedural requirements vary slightly, but the general procedures outlined in FINRA arbitration are similar. The main differences between the forums are the expensive forum fees and arbitrator selection.