Auction Rate Securities Fraud Lawyer

FINRA and ARS Arbitration

The Financial Industry Regulatory Authority (FINRA) was created in 1939, one year after the Maloney Act amendments to the Securities Exchange Act of 1934. FINRA’s responsibilities include the supervision of all securities firms that work in the United States. This includes, but is not limited to, the oversight of the American Stock Exchange, the International Securities Exchange, regulation of the market for the NASDAQ stock market, and some 5,000 brokerage firms.

FINRA also has the responsibility to:
• Examine securities firms
• Enforce federal securities laws
• Educate investors
• Administer dispute resolution forums for investors and firms through arbitration

Mandatory Arbitration

Almost all agreements and contracts between investors and brokerage firms have mandatory arbitration agreements. This means that investors do not have the right to a regular trial in a court of law if disputes between the investor and brokerage firm lead to the need for legal action. Instead, the investor must go through the arbitration process, run by the Financial Industry Regulatory Authority.

It is FINRA’s mission to ensure that investors have a trusted advocate and that the markets remain fair. Investors who have been harmed due to the failure of auction-rate securities have the right to file for arbitration if they believe that their broker misrepresented the liquidity and risk involved in auction-rate securities.

For more information on arbitration or to schedule a consultation with a skilled auction rate securities attorney, call 800-220-9341.