FINRA Arbitration Award: $390,000 In Compensatory Damages For Broker Negligence
On June 10th, 2022, a FINRA Arbitration panel at a hearing site in Boca Raton, FL awarded a claimant $390,000 in compensatory damages (Case Number: 19-02212). The respondent in the case was the nationally-known brokerage firm J.P. Morgan Securities, LLC. The claim was filed after an investment strategy touted by the broker-dealer reportedly went array. Notably, the brokerage firm was also required to assume a losing short position in American Airlines stock held by the claimants. In this blog post, our Miami investment fraud attorney discusses the award from the FINRA arbitration panel.
FINRA Arbitration Claim: Broker Negligence and Breach of Fiduciary Duty
The claimants in this case were a married couple who were Joint Tenants with Right of Survivorship—meaning they held an equal interest in a piece of property. The information provided about their Statement of Claim against J.P. Morgan Securities, LLC indicates that the sustained financial losses after an investment strategy touted by the broker-dealer went wrong. They raised several specific causes of action against J.P. Morgan Securities, LLC, including:
- Broker negligence;
- Professional misconduct;
- Material misrepresentation;
- Material omissions of fact.
- Breach of fiduciary duty;
- Breach of securities industry rules & regulations; and
- Breach of contract.
After reviewing the matter, the FINRA Arbitration Panel sided with the claimant—awarding the investors compensatory damages. To start, the investors were awarded $390,000 in direct financial compensation for their losses. Additionally, the investors were also freed from their “short position” in AMR CORP. Thousands of shares of shorts of AMR CORP (the parent company of American Airlines) must be transferred from the investors to J.P. Morgan Securities, LLC. These are short positions that suffered financial losses.
Most Investors are Required to Arbitrate Claims Against Broker and Broker-Dealers
Did you sustain investment losses due to the wrongful conduct of your financial advisor or your brokerage firm? You may be entitled to compensation. However, in some circumstances, you will not be in a position to file a lawsuit against the broker or broker-dealer. Most financial advisors and brokerage firms require their investors to sign a “customer agreement” which contains a mandatory arbitration clause.
Mandatory arbitration provisions within broker/brokerage firm contracts are legally enforceable. An investor who has a claim against a financial advisor or broker-dealer will generally need to pursue compensation through the FINRA arbitration process. As there are strict rules and regulations governing FINRA arbitration, it is crucial that you retain guidance from a securities fraud lawyer with experience handling FINRA arbitration claims.
Contact Our Miami, FL FINRA Arbitration Attorney for Immediate Legal Help
At Carlson & Associates, P.A., our South Florida broker negligence attorney is a devoted and reliable advocate for investor rights. If you or your loved one sustained serious investment losses due to a broker’s breach of fiduciary duty, negligence, or securities law violations, we are here as a legal resource. Contact us today to set up a completely confidential initial case assessment.
Source:
finra.org/sites/default/files/aao_documents/19-02212.pdf