According to statistics put together by the Financial Industry Regulatory Authority, the number of securities arbitration cases brought by the self-regulatory agency is on target to exceed last year’s total. A likely contributor to the increase can be attributed to the numerous Puerto Rico municipal bond cases already filed by investors who sustained huge losses. More of these are inevitable, especially as FINRA just increased its arbitrator pool to deal with cases involving muni bonds from the US territory.
The broker-dealer regulator said that during this first quarter alone, 1,011 FINRA arbitration cases were submitted—a definite increase from the 919 securities arbitration claims filed during 2013’s first three months. However, the number of arbitration cases that were closed during this first quarter is less than in two years prior, with just 946 resolved. Compare that to the over 4,400 and 4,800 cases in 2013 and 2012, respectively.
That said, 5O% of arbitration cases decided during this initial quarter rendered damage awards, which is more than in the last two years. The most common claim in FINRA arbitration cases filed in 2014 so far is breach of fiduciary duty. Negligence, failure to supervise, and breach of contract are the other leading claims.
Arbitration is another means to resolving disputes as opposed to mediation and arbitration. A FINRA panel of arbitrators presides over the cases, studies the evidence and issues a ruling. The decision is final and binding unless a successful challenge is made in court within the statute of limitations. While outcomes are generally not made known to the public, if an award is issued then the SRO will publish this information.
Our FINRA arbitration law firm works with individual investors and institutional investors. We are here to help investors get their losses back. Shepherd Smith Edwards and Kantas, Ltd. LLP would like to offer you a free case assessment to find out whether you have reason to file an arbitration claim.
Finra sees uptick in arbitration cases filed in first quarter, InvestmentNews, April 22, 2014
Arbitration Overview, FINRA
More Blog Posts:
FINRA Seeks to Limit Definition of Public Arbitrator, Stockbroker Fraud Blog, February 11, 2014
FINRA Doesn’t Want Oversight Over Financial Advisers, Says CEO Ketchum, Stockbroker Fraud Blog, April 12, 2014
Lawyers, Investor Advocates Want to Know More About SEC Supervision Of FINRA’s Arbitrator Selections, Institutional Investor Securities Blog, December 2, 2013