FINRA Arbitration Lawyers for Investors in Miami

When a stockbroker or brokerage firm causes an investment loss, the case is usually decided in FINRA arbitration rather than in court. FINRA, the Financial Industry Regulatory Authority, runs the arbitration forum that hears most disputes between investors and the brokerage firms and registered representatives they deal with. Reiser Law, P.C. represents investors in FINRA arbitration from our office on Brickell Avenue, including retirees and older investors whose savings were placed in unsuitable or concentrated positions.

Can I bring my claim in FINRA arbitration?

Usually, yes. Under FINRA's rules, a dispute must be arbitrated if arbitration is required by a written agreement or requested by the customer, the dispute is between a customer and a FINRA member firm or one of its associated persons, and the dispute arises in connection with the business activities of the firm or the associated person. FINRA Rule 12200. That means an investor can require the firm to arbitrate even without an arbitration agreement, and most brokerage account agreements contain one anyway.

The six-year eligibility rule

No claim is eligible for FINRA arbitration if six years have passed from the occurrence or event giving rise to the claim. FINRA Rule 12206(a). The six years run from the event, not from when the investor discovered the problem.

The rule does not extend any statute of limitations. Filing a statement of claim in arbitration tolls court deadlines for filing the claim while FINRA retains jurisdiction over it. FINRA Rule 12206(c). Florida and federal limitations periods for securities claims can be shorter than six years, so the eligibility rule is not a safe harbor. Our page on Miami investment fraud explains the Florida deadlines.

What brokers owe their customers

Regulation Best Interest. When a broker-dealer recommends a securities transaction or investment strategy to a retail customer, it must act in the customer's best interest at the time of the recommendation, without placing its own financial or other interest ahead of the customer's. 17 C.F.R. § 240.15l-1(a)(1). The rule is satisfied only if the firm meets four component obligations: disclosure, care, conflict of interest, and compliance. § 240.15l-1(a)(2)(i)-(iv). A retail customer is a natural person, or that person's legal representative, who uses the recommendation primarily for personal, family or household purposes. § 240.15l-1(b)(1).

Suitability. For recommendations not covered by Regulation Best Interest, such as those to institutional customers and to individuals investing for business purposes, FINRA's suitability rule applies. FINRA Rule 2111, Supplementary Material .08. A firm must have a reasonable basis to believe a recommended transaction or strategy is suitable for the customer, based on reasonable diligence into the customer's investment profile. FINRA Rule 2111(a). The rule includes three obligations: reasonable-basis suitability, customer-specific suitability, and quantitative suitability, which addresses a series of transactions that are excessive when taken together. FINRA Rule 2111, Supplementary Material .05.

Supervision. Each member firm must establish and maintain a system to supervise the activities of each associated person that is reasonably designed to achieve compliance with securities laws and FINRA rules. FINRA Rule 3110. A firm that fails to supervise a broker may be liable for losses the broker caused.

Selling away. Brokers who sell investments outside their firm, often called selling away, are subject to FINRA's rules on private securities transactions. In September 2026, the SEC approved FINRA's proposal to replace those rules with a new outside activities rule, Rule 3290, which takes effect on a date FINRA will announce. SEC Release No. 34-106381 (Sept. 15, 2026). Under either version, the firm's knowledge of and responsibility for outside sales is often the central question.

Common investor claims

  • Unsuitable or not-in-best-interest recommendations, including overconcentration in one stock, sector or product
  • Excessive trading in an account the broker controlled
  • Misrepresentation or omission of the risks of a product
  • Unauthorized trading
  • Investments sold away from the broker's firm
  • Failure to supervise
  • Financial exploitation of older or vulnerable investors; see our article on elder financial abuse and FINRA arbitration

How a FINRA arbitration works

  1. Statement of claim. The investor files a statement of claim describing what happened and the relief sought, and pays a filing fee.
  2. Answer. The firm and the broker respond.
  3. Arbitrator selection. Claims of $50,000 or less, exclusive of interest and expenses, go to a single arbitrator under simplified procedures. Claims of more than $50,000 and up to $100,000 are heard by one arbitrator unless the parties agree in writing to three. Larger claims, and claims for unspecified or non-monetary relief, are heard by three arbitrators unless the parties agree in writing to one. FINRA Rule 12401.
  4. Document exchange and hearing preparation. The parties exchange account records, notes, supervisory files and communications, and prepare witnesses and experts.
  5. Hearing and award. In simplified cases, no hearing is held unless the customer requests one. FINRA Rule 12800(c). Otherwise, the panel hears evidence and issues an award. The arbitrators issue an explained decision stating the general reasons for the award only if all parties jointly request one. FINRA Rule 12904(g). Monetary awards must be paid within 30 days of receipt unless a motion to vacate has been filed in court. FINRA Rule 12904(j).

Arbitration awards are final in most cases, and court review is narrow. That makes preparation for the hearing the most important part of the case.

Checking a broker's record

FINRA's BrokerCheck is a free tool for researching the professional background of brokers, brokerage firms and investment adviser firms, including customer complaints, regulatory actions and employment history. We review it at the start of every case.

What to gather before you call

  • Account opening documents and new account forms, including your stated objectives and risk tolerance
  • Monthly and annual account statements and trade confirmations
  • Written communications with the broker, including e-mails and texts
  • Any marketing material for the products you bought
  • Notes of conversations, with dates
  • Any letters from the firm about complaints, investigations or the broker's departure

Questions clients ask

My account agreement has an arbitration clause. Can I still sue in court?

Usually not against the firm or the broker. FINRA arbitration is the standard forum. Claims against other parties, such as an issuer or an outside promoter, may proceed in court.

Is there a deadline?

Yes. FINRA's six-year eligibility rule runs from the event giving rise to the claim, and shorter state and federal statutes of limitations may also apply.

How long does a FINRA arbitration take?

It varies with the size and complexity of the claim. Simplified claims of $50,000 or less can be decided on the papers. Larger cases go through document exchange and an evidentiary hearing.

Can I bring a claim for a parent or grandparent?

A legal representative, such as an agent under a power of attorney, a guardian or a personal representative, may be able to bring the claim. Losses to older investors often involve additional state-law protections.

Talk to us

Matthew W. Reiser and Isabella Martinez, based in Miami, are members of The Florida Bar and the State Bar of California. Isabella Martinez is fluent in Spanish. To discuss an investment loss at a brokerage firm, call (305) 726-2003, email matthew@reiserlaw.com or isabella@reiserlaw.com, or use our contact page. Our office is at 1000 Brickell Ave, Suite 1100, Miami, FL 33131. See also investor fraud and Ponzi scheme recovery.

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