Securities Arbitration in FINRA: A Guide to What Every Securities Broker Needs to Know

February 2009

Securities brokers, financial planners and other professionals are facing serious repercussions from the current Credit Crisis and downturn in the economy in the form of increased and widespread investor claims.  It would benefit these professionals to understand the Financial Industry Regulatory Authority (FINRA) arbitration process in order to better manage risk and prevent future claims, to bring disputes to early and economical resolutions, and to fully defend matters that should be contested on the merits.  Looking ahead, 2009 may be a record-setting year for new FINRA claims due to the generalized bear market.


In the attached guide, Wilson Elser provides a simplified user's manual for the professional who may be on the receiving end of a customer's Statement of Claim filed in FINRA.  This guide discusses strategies that can aid financial industry professionals when they are confronted with such claims.  Among the topics discussed in depth are understanding FINRA arbitration procedures; how FINRA trumps the right to a jury trial and to an appeal; regulatory implications of FINRA arbitrations; pre-arbitration steps to improve prospects for success; appointing defense counsel; arbitrator selection; discovery; mediation; preparing to testify; and the award.


This guide has been created by Wilson Elser's Financial Institutions Defense Practice. The practice's experience in dealing with securities claims is extensive and nationwide in scope.  We have experience with every type of securities product at issue, from the simple, like stocks and bonds, to the most complex, like derivatives, as well as the manner in which they are traded.  In the broker-dealer field, Wilson Elser provides focused, cost-efficient handling of sensitive and complex defense of arbitration and litigation matters.  Our attorneys have represented broker-dealer firms in thousands of proceedings.  We also provide several forms of consulting to broker-dealers and their insurers.  Our team also represents clients in securities enforcement matters.  We offer clients a deep knowledge of securities industry practices and relevant governing statutes, rules and regulations.



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