Is mediation of your stockbroker fraud claim right for you?

If you have lost money due to your broker's misconduct or fraud, you may be wondering how you go about recovering your losses. Do you need to go through a formal arbitration proceeding or is there a less formal way of resolving your broker misconduct case?
There is an alternative to stockbroker arbitration and litigation in regards to settling a dispute with your broker. It is known as mediation. The Financial Industry Regulatory Authority (FINRA) handles over 1,000 cases in stockbroker mediation on an annual basis. According to FINRA, many of the cases that go through their mediation program settle within a few weeks to a few months after making a formal agreement to mediate.

What is stockbroker mediation and why would I choose this option?

FINRA provides a great definition of mediation, which is "an informal, voluntary, and non-binding approach in which an independent and trained neutral - a mediator - facilitates negotiations between disputing parties, helping them to find their own mutually acceptable resolution." In other words, mediation allows you to come to a resolution with the brokerage firm in a non-threatening, informal atmosphere.

Make sure you know what is involved in mediation.

The following will occur during the mediation process:

1. The mediator is selected. When you choose mediation, both parties will agree upon a neutral third party to aid in the negotiations. This person will possess a thorough understanding of securities law. The mediator will not be deciding the outcome of the case. Instead, he or she will focus on guiding both parties to an acceptable solution.
   
2. An opening session is held. This session involves both parties and the mediator. Each side will have the opportunity to explain background information, key facts, damages and liability.
   
3. Separate meetings take place. The mediator will meet privately with each party following the opening session, which are referred to as caucuses. During these caucuses, the mediator will hear the critical issues pertaining to the dispute. These meetings are confidential and the purpose is to help the parties move closer to a settlement.
   
4. Proposed resolution is made. During the mediation process, both sides have the chance to brainstorm solutions that would be acceptable to each party. If the parties agree to a solution, the dispute is resolved and a settlement agreement is signed.

Mediation is voluntary. If you are not satisfied with the outcome of the negotiations, you do not need to sign the settlement agreement. You can proceed to arbitration. Often, the most effective time to mediate a claim is once the formal arbitration claim is pending with FINRA and the parties have completed all the fact-finding and evidence gathering.

Do I need a securities mediation attorney?

Even though mediation is considered to be less formal than other forms of dispute resolution, by no means should you attempt it alone. The brokerage firm will be relying on their group of sophisticated defense lawyers, even during the mediation process. It is therefore in your best interests to have an experienced securities mediation lawyer on your side, guiding you through the process.
For more information or for a free case evaluation, contact the law firm of Meyer Wilson by calling toll-free 1.866.827.6537 or filling out our online form. We have represented over 800 individual and institutional investors from across the country in securities mediation, arbitration, litigation and class action lawsuits.

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