- Martin Act – Grants New York’s attorney general broad authority to investigate and prosecute securities fraud
- FINRA Suitability Rule – Mandates that brokers recommend investments based on an investor’s specific financial situation and objectives
What Is the Role of FINRA?
The Financial Industry Regulatory Authority (FINRA) oversees brokerage firms and enforces rules designed to protect investors. It ensures brokers comply with securities laws, investigates misconduct, and resolves disputes through arbitration. FINRA arbitration is a streamlined process that allows investors to seek compensation for losses caused by broker misconduct.
Brokerage firms must adhere to FINRA regulations, including suitability requirements, disclosure obligations, and supervisory responsibilities. When firms fail to prevent fraud, unauthorized trading, or other violations, investors can file arbitration claims against them. FINRA arbitration panels review evidence, hear arguments, and issue binding decisions.
FINRA litigation is not typically an option for investors who have suffered financial harm due to the negligence or misconduct of a brokerage firm. However, they may be eligible to recover their losses through FINRA arbitration and hold fraudulent brokerage firms accountable.
What Can I Do If I Suffered Investment Losses?
If you have suffered investment losses due to broker misconduct, Erez Law PLLC can help you take action to recover damages through FINRA arbitration. The first step in the FINRA investigation process is to review your account statements and communications for signs of fraud, unauthorized trading, or unsuitable investments. Our lawyers who work on FINRA arbitration cases can analyze your case, determine whether the brokerage firm failed in its supervisory duties, and prepare a claim on your behalf.
Filing a FINRA arbitration claim involves submitting a statement of claim that details the misconduct and your financial losses. Following a discovery period, we go through a series of hearings before the FINRA panel issues its final arbitration decision.
It’s important to act quickly to remedy your investment losses because FINRA has a six-year eligibility rule for arbitration claims. Turning to Erez Law PLLC early for legal guidance can help preserve your right to compensation.
Contact Erez Law PLLC for a Free Consultation
If your broker or the firm employing them engaged in fraudulent or negligent conduct that caused you to suffer financial losses, let the team at Erez Law PLLC provide the legal support you need. We’ll fight to secure a fair settlement or FINRA arbitration award that recovers your losses and holds the broker accountable for their conduct. Contact us today to get started with a free consultation and learn more about your legal rights and options.Investors in New York who have suffered financial losses due to broker misconduct may have the right to recover those losses through the FINRA arbitration process. Many cases involve fraudulent investments, unsuitable recommendations, or broker negligence. Erez Law PLLC represents investors in claims against brokerage firms that failed to supervise their employees. If you believe your stockbroker or their employer is responsible for your losses, taking legal action through New York FINRA arbitration may be an option. Contact the team at Erez Law PLLC for a free consultation to discuss your case.
Why You Need an Investment Loss Attorney
Attempting to recover investment losses can be a challenging process, especially when the losses are due to broker misconduct. Investors often assume they have no recourse, but FINRA arbitration provides a path to recover damages from brokerage firms that failed to supervise their employees. An experienced investment fraud attorney can assess your case, identify regulatory violations, and pursue claims against the responsible firm.
Erez Law PLLC is a nationally recognized team of lawyers that works on FINRA arbitration cases. We have successfully resolved over 2,000 arbitration cases and recovered more than $320 million for our clients. Our team brings over 35 years of experience to our work on behalf of clients. As one satisfied client wrote:
“In my experience, Jeff Erez performed at the highest level. He had an immediate grasp of what needed to be accomplished and was efficient and very professional. He achieved a result that exceeded my expectations while relieving me of often burdensome and cumbersome paperwork. Clearly, this was NOT his first rodeo.” – Alice H.
When you trust Erez Law PLLC with your case, we can do the following:
- Evaluate your case to determine whether broker misconduct occurred
- Investigate brokerage firm failures in supervision and compliance
- Gather evidence, including account statements and communications
- File a FINRA arbitration claim against the responsible brokerage firm
- File cases in AAA or JAMS arbitration when against an RIA or in court as required
- Represent you throughout the arbitration process
- Seek compensation for unauthorized trades, excessive commissions, and unsuitable investments
- Hold brokerage firms accountable for fraud, negligence, and regulatory violations
Learn if you have a viable case when you call for a free case evaluation.
Types of Cases Our Investment Fraud Attorneys Handle
Investors trust brokerage firms to manage their accounts responsibly. Misconduct can lead to substantial financial losses. When stockbrokers engage in fraudulent or negligent behavior, their employers may be held liable through FINRA arbitration. Erez Law PLLC represents investors in claims against brokerage firms for failing to supervise their employees. Some of the types of cases we handle include:
- Churning – Excessive trading in an account to generate commissions, often without benefiting the investor
- Lack of Diversification – Concentrating investments in a few securities or sectors, increasing risk and exposing investors to unnecessary losses
- Misrepresentation – Providing false or misleading information about an investment, leading investors to make decisions based on inaccurate details
- Negligence – Failing to exercise reasonable care in handling an investor’s account, resulting in losses
- Fraud – Engaging in deceptive practices, such as falsifying investment performance or misrepresenting investments, to mislead investors
- Unauthorized Trading – Executing trades without the investor’s knowledge or consent, violating industry regulations
- Unsuitable Investments – Recommending investments that do not align with the investor’s financial goals, risk tolerance, or investment profile
- Violations of Securities Laws – Failing to comply with federal and state securities regulations, exposing investors to unnecessary risk
- Breach of Fiduciary Duty – Placing the financial advisor’s financial interests above those of the investor, leading to conflicts of interest and financial harm.
- Selling away – Brokers cannot sell investments to customers that their brokerage has not pre-approved. Doing so is a violation of securities laws.
- Structured notes fraud – Brokers must follow strict rules when recommending structured notes due to the potential to risk the investor’s principal, but some blatantly disregard these rules.
- Options fraud – Options fraud can occur when a broker misrepresents the risks of options to investors, make unauthorized trades into risky options, or overconcentrate investor portfolios in options.
What Laws Protect New York Investors?
New York investors are protected by both federal and state securities laws, as well as FINRA regulations. These laws establish standards for broker-dealers and impose obligations on brokerage firms to supervise their employees. Key protections for investors pursuing New York FINRA cases include:
- The Securities Exchange Act of 1934 – Regulates securities transactions and holds brokerage firms accountable for fraud and market manipulation
- SEC and FINRA Rules – Require firms to conduct due diligence, maintain compliance programs, and prevent broker misconduct