Ben Dell’Orto, Spring 2018 IAC Student Intern
Though everyone expects (and should expect) to be treated fairly by the guy handling his or her investments, in the clinic we know that this will not always be the case. Another thing we know is that the critical thing in proving a claim against an investment adviser or broker is going to require proof. While this proof can sometimes be gathered during discovery, some documents can never be found unless the customer keeps track of them.
The FINRA arbitration forum is not as strict about the rules of evidence as a court, FINRA Rule 12604 stating that “the panel is not required to follow state or federal rules of evidence.” However, the arbitrators are still going to be looking for evidence of a customer’s complaint if they are going to provide a significant judgment. Perhaps more importantly, possession of solid evidence is going to be a key in getting the other side to take your claim seriously; a brokerage firm is much more likely to offer up a solid settlement to somebody with a set of damning evidence than somebody with just a story to tell.
But that’s really what it’s about. If you ever find yourself adverse to your broker or firm, you’re going to need to tell a convincing story, and the story that’s MOST convincing is the one that involves evidence. While there are no specific former employment requirements to become a FINRA arbitrator—just five years of business or professional experience and two years of college—most FINRA arbitrators are lawyers, and they will be especially looking for that evidence. Some of these documents will also be useful for monitoring your account for any misconduct, to try and catch the problem early.
So what documents should you keep up with? Check in every Friday to learn about the benefits of your notes of conversations, records of meetings, new account applications, transfer documents, monthly statements, and records of correspondence with your adviser.