If you’re considering filing a complaint against your financial advisor it’s important that you have a clear understanding of the general process.
As a registered financial advisor (RIA), your financial advisor, and the firm that employs him or her, is regulated by the Financial Industry Regulatory Authority (FINRA).
Accordingly, if you move forward with filing an official complaint against your advisor, you will be filing the complaint with FINRA.
To ensure that your legal rights and financial interests are properly protected, it is imperative that you file a well-crafted, strongly supported initial advisor complaint. Here, our experienced FINRA arbitration attorneys will break down the key steps in filing a FINRA complaint against your financial advisor or stockbroker.
Filing a complaint against your financial advisor…
- Understand the Basics of FINRA’s Dispute Resolution Process
- Consider Possible ‘Informal’ Remedies
- Prepare a ‘Statement of Claim’ for FINRA
- Gather Relevant Documents and Records
- Complete and File Your ‘Submission Agreement’
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1. Understand the Basics of FINRA’s Dispute Resolution Process
When you open up a brokerage account, you will be likely be required to sign some type of customer agreement. Your customer agreement will control some aspects of any dispute that you might have against your broker, advisor or firm. Most importantly, the vast majority of modern customer agreements contain a mandatory arbitration clause.
A pre-dispute arbitration provision will require you to resolve any claim you have against your broker or brokerage through FINRA’s dispute resolution process. As your dispute will be forced into arbitration, it is imperative that you have a basic understanding of FINRA’s arbitration proceedings so that you can file your claim in an efficient and effective manner.
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2. Consider Possible ‘Informal’ Remedies
Filing for arbitration is a major commitment. Of course, there are many cases in which arbitration will be necessary to ensure that you recover the full and fair monetary award that you deserve. That being said, before you file for arbitration, you should always weigh all of your other available alternative options.
Indeed, FINRA explicitly instructs investors to pursue informal remedies before filing their complaint. There are some cases in which you will be able to resolve your dispute without needing to actually escalate the problem to arbitration. More specifically, before you submit your claim and file for FINRA arbitration, we recommend that you do the following four things:
- Consult with a qualified attorney: Your investor rights attorney can review your case and help you assess your legal options.
- Contact the broker or advisor: If you have a complaint against an individual, either a registered broker or a registered financial advisor, it is best practice to speak to them directly regarding your complaint. When doing so, please be sure to document your conversation.
- Contact the firm’s compliance department: The third step in the informal resolution process is to speak to a compliance official at your brokerage firm. Once again, be sure to thoroughly document your correspondence so that you have it as evidence should you need it in the future.
- Consider mediation: Finally, in some cases, you and your broker or brokerage may be able to resolve your complaint through voluntary, non-binding mediation. If you are entering into a mediation, you should always be represented by an experienced FINRA attorney.
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3. Prepare a ‘Statement of Claim’ for FINRA
When it becomes apparent that you will need to escalate your claim to arbitration, you will be required to submit your complaint directly to the Financial Industry Regulatory Authority (FINRA). This organization offers two different ways to submit a complaint: You can do it online or you can send it through the mail.
When you file, you will be asked to include an official “Statement of Claim”. Simply put, a statement of claim will be a written document in which you explain exactly what happened in your case. This is your chance to tell FINRA officials your story. You should clearly articulate all important facts in your case, in as much detail as you can possibly provide.
Your statement of claim is one of the key early foundational pieces of your case. To ensure that your interests are fully protected, it is highly recommending that you prepare your statement with the assistance of a qualified investment fraud lawyer.
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4. Gather Relevant Documents and Records
Along with your statement of claim, you should also include any documents and records that you have that are relevant to your case. Ultimately, all good legal cases must be built on a strong foundation of supporting evidence. These documents should all be clearly identified so that you can make reference to them in your statement.
Of course, you may not currently have access to all of the records that are relevant to your case. This is completely normal, and it will not prevent you from filing an effective complaint. You should gather and secure all of the records that you can at the current time. As your case proceeds, your attorney will be able to take action using the FINRA discovery process.
This can help you get access to key documents, records or evidence held by your broker, financial advisor or brokerage firm. Under FINRA rules and federal securities laws, broker-dealers have certain record keeping obligations.
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5. Complete and File Your ‘Submission Agreement’
Finally, after you have exhausted all of your other remedies and carefully prepared a compelling complaint, you should send it in to FINRA with your signed ‘Submission Agreement”. Once you sign and submit the agreement, your case will be bound by FINRA’s rules and the arbitration panel’s eventual decision. The time clock will start, and your complaint will be served on your broker or broker-dealer.
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Are You Ready to File a FINRA Complaint Against Your Financial Advisor?
We can help. At Sonn Law Group our aggressive, reputable FINRA arbitration lawyers are standing by, ready to hear your case. We can help you bring a FINRA complaint against your broker, financial advisor or brokerage firm. To request your free, no strings attached case evaluation, please call us today at 844-689-5754 or fill out our brief online contact form. We handle FINRA arbitration cases on a contingency fee basis. If you do not recover compensation, our team will not get paid.