What is the FINRA dispute resolution process?
The Financial Industry Regulatory Authority (FINRA) Dispute Resolution process is a process in which disputes between investors and securities firms or brokers are resolved. It is used for disputes involving Washington-based securities firms or brokers in which monetary damages may be awarded to the aggrieved investor. The process begins with the filing of a Statement of Claim. This document outlines the grievances of the investor and must be filed with FINRA within six years of the alleged violation, or within three years of the time in which the investor should have reasonably discovered the violation. Once the Statement of Claim is filed, FINRA will review the claim and make a determination as to if it has merit. If FINRA determines that the claim has merit, a hearing will be scheduled before a FINRA arbitration panel. At the hearing, both parties have the opportunity to present evidence, call witnesses and question the other party. The FINRA arbitration panel will then make a decision based on the evidence presented. If the decision is in favor of the investor, FINRA has the authority to order the firm or broker to pay for any monetary damages up to the amount listed in the Statement of Claim. The decision of the FINRA arbitration panel is final and binding, and cannot be appealed.
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