How a Securities and Investment Fraud Attorney Reviews Finra Claims

Compare account agreements with FINRA BrokerCheck. Identify the firm providing services and the representative's status when the sale occurred. Registration alone does not establish that an outside transaction involved the firm. A statement may identify a clearing firm while payment records name another entity. Distinguish the account custodian from the seller and determine whether the brokerage firm participated in the recommendation or transaction.

A dual-registered professional can act as a broker on one sale and an adviser on another. Form CRS, contracts, and payment records help identify that capacity. Other arbitration agreements may designate a different forum. Check whether the customer paid advisory fees or brokerage commissions and which entity executed the trade. Contract labels provide evidence, but the services actually performed may affect the applicable duties and forum.

Rule 12202 generally requires post-dispute written customer consent for claims against inactive members or associated persons. If a respondent becomes inactive during proceedings, customers may withdraw affected claims within 60 days after receiving FINRA's notice. Outside sellers do not automatically qualify as FINRA respondents. A broker's departure also does not, by itself, eliminate claims against the member firm. The firm's involvement and each respondent's status require separate review.

Compare sales messages and offering documents with executed trades. Were liquidity restrictions concealed or trades unauthorized? Misrepresentation and unauthorized trading support distinct investment fraud theories requiring different proof. A promise that an investment could be sold immediately may conflict with contractual transfer restrictions. The investor must examine what the broker knew, what was disclosed, and whether the statement affected the purchase.

SEC Regulation Best Interest governs covered broker-dealer recommendations to retail customers through disclosure, care, conflict-of-interest, and compliance obligations. It does not govern advice given solely in an investment-adviser capacity or create an independent private damages claim. Federal securities and state-law claims require their own elements. Fraud claims may require proof of materiality, reliance, and causation, depending on the legal theory. Unauthorized trading instead focuses on consent and the authority granted over the account.

Match recommendations to orders and payments. Record disclosure dates and authorization. For payments outside the brokerage account, identify who received the funds and their relationship to the firm. Preserve complete email threads, order confirmations, and original electronic records. A payment to an outside promoter may help identify another responsible party, but it does not automatically establish liability against the brokerage firm.

Reconcile invested funds, withdrawals, distributions, fees, and remaining value. Portfolio decline alone does not prove recoverable damages. Causation and the governing claim control recovery. An investment may also have uncertain liquidity or valuation. Compare records from relevant dates rather than relying on a single account balance. Other investment loss recovery proceedings may require tracing payments to third parties.

Rule 12206 generally excludes claims six years after the event giving rise to them; the panel decides eligibility. That event need not be the discovery of a loss. Separate federal or state limitation periods may expire sooner. Rule 12206(c) tolls applicable court-filing periods while FINRA retains jurisdiction, but does not revive an expired claim. An investor therefore cannot assume that satisfying FINRA's eligibility rule preserves every underlying cause of action.

Rule 12302 requires a signed, dated Submission Agreement and a Statement of Claim describing facts and remedies. The claim should identify specific misconduct rather than merely stating that an investment lost money. Before filing, investors should:

• Name the respondents and transactions at issue.
• Connect each allegation with supporting records and a loss calculation.
• Check filing fees under Rule 12900 and the applicable submission method.

Rule 12300 allows self-represented customers to opt out of FINRA's Party Portal. Claims outside FINRA may require another investment dispute forum.