The FINRA Arbitration Process: What to Expect
June 14, 2022
Arbitration is an alternative to litigation. Disputes between investors and investment professionals are arbitrated before the Financial Industry Regulatory Authority (FINRA). At FINRA, arbitration panels are composed of one or three arbitrators who respond to pleadings, listen to arguments, study the evidence, and render decisions. When an arbitration panel renders a decision in an arbitration case, it is final and binding on all the parties. Unlike courtroom litigation, arbitration is confidential, meaning that most arbitration documents aren’t available to the public. Below are some tips on what to expect as an investor entering the FINRA arbitration process.
Since arbitration is less formal than litigation, the process tends to be quicker. The turnaround time for arbitration is typically affected by the following factors:
The number of parties
The number of witnesses
The complexity of the case
The amount of discovery
The schedules of the arbitrators and parties
Cost in an arbitration case is affected by factors such as:
The amount of the claim
The number of sessions
The number of discovery motions
The number of postponements
Cases eligible for arbitration
A case is eligible for FINRA arbitration if:
The case involves an investor and an individual or entity registered with FINRA
The claim is filed within six years from the event that caused the dispute
An investor is required to arbitrate at FINRA if:
Arbitration is required pursuant to a written agreement
The dispute involves a member of FINRA
How Arbitration Cases Are Resolved
Arbitration cases are resolved in a variety of ways. In some cases, the arbitrators reach a final decision. In other cases, the parties enter a settlement agreement prior to conclusion of the arbitration process. In many cases, aggrieved investors receive compensation, both in monetary and non-monetary form, and such compensation can come as a result of either an arbitration panel decision or executed settlement agreement.
Make Your Arbitration A Success
Many individuals choose to tackle the arbitration process alone. However, despite the fact that arbitration is less formal than litigation, it can still be extremely complicated, and attempting to navigate the process alone can be a mistake. Therefore, in order to avoid missing out on possible compensation, you should strongly consider hiring a Florida investor representation attorney to represent you during the arbitration process.
Fort Lauderdale Investor Representation Attorney
At Simms Law, P.A., one of our primary focuses is the representation of investors—including those investors who believe they’ve been the victims of financial fraud—in both litigation and FINRA arbitration. At Simms Law, we take your concerns seriously, and we are fully prepared to fight for your right to receive compensation for your losses. Therefore, if you suspect that any suspicious activity has occurred in any of your investment accounts, or if you believe that you have been misled about the nature and risks of any of your investments, please contact us today for a free consultation.