FINRA’s Virtual Arbitration Hearings Produce Atypical Results
June 14, 2022
In-person arbitration hearings at the Financial Industry Regulatory Authority (FINRA) have been on hold since COVID-19 hit U.S. shores. However, FINRA offers parties who agree to do so the option to attend hearings via videoconference. So far, parties have filed virtual hearing requests in only about 2% of open cases, and the results of these cases have been atypical of past FINRA arbitration results. Below is an overview of the main differences between live and virtual FINRA arbitration hearings. For additional assistance with FINRA arbitration, please contact an investor representation attorney.
Nearly Two-Thirds Of Virtual Arbitration Hearings Have Resulted In Settlement
Although FINRA doesn’t publish statistics on settlement rates for in-person hearings, it’s estimated that approximately ten percent of all arbitration cases settle. Virtual cases, however, have a much higher rate of settlement. Specifically, as of August 12, FINRA has reported that 65% of its cases involving virtual hearings have resulted in settlement.
Virtual Hearings Have Been Quick
The FINRA arbitration hearings that have been held entirely via videoconference were all relatively short. The average length of an in-person FINRA hearing is four days. However, the cases that have been held entirely virtually have taken no more than three days to complete, with the shortest taking half a day. However, it should be noted that complex cases with multiple witnesses and extensive evidence have not yet been put to the test virtually. In fact, no “average” cases have yet been held virtually, meaning that it’s difficult to tell whether the length of typical FINRA cases will be affected by the virtual format.
Virtual Hearing Awards Have Been Common
Finally, all the hearings involving at least one virtual session that proceeded to the final award stage have resulted in damages. Ordinarily, only half of such cases result in damages. In addition, three of the cases that proceeded to the final award stage resulted in awards beyond compensatory damages, with one awarding attorney fees and interest, one awarding sanctions and punitive damages, and one awarding costs and attorney fees.
Contact An Investor Representation Attorney
If the improper actions of your financial advisor or broker have resulted in financial losses, you need an experienced investor representation attorney on your side. At Simms Law, P.A., one of our primary focuses is the representation of investors. Whether you are a victim of financial fraud or your feel that your financial advisor or broker failed to take your best interests into account when making investment recommendations, we can help you obtain the compensation you deserve At Simms Law, we know what is at stake when an investor suffers financial losses, and we’ll fight for your right for compensation. Therefore, if you have been wronged in some way by a financial advisor, broker, or another financial professional, please contact us today for a free evaluation of your case.