About the Arbitration Process at FINRA

About the Arbitration Process at FINRA

What is the Arbitration process at FINRA. Arbitration is a method of resolving a dispute between two or more parties. Parties must agree to abide by the decision of an arbitrators, such as myself, who as a group are impartial persons committed to rendering a fair and impartial decision after all parties have had an opportunity to present their cases.

The arbitrators’ award is final, subject to court review only under limited circumstances. There is no appeal process within FINRA.  However, the parties may file a motion to vacate the arbitration award in a court of competent jurisdiction.  Therefore, arbitration is a fair, quick, and inexpensive alternative to litigation.

There has been a dramatic increase in the use of arbitration for all types of disputes since the late 1980’s.  The increase in the number of securities arbitrations was influenced by a U.S. Supreme Court decision (Shearson v. McMahon, (1987) 482 US 220) that helped establish arbitration as the predominant procedure for resolving securities disputes. Prior to this decision, the binding nature of the arbitration agreement and the broad scope of an arbitrator’s authority in securities cases were less clear. Arbitration is the primary means of resolving disputes in the securities industry, therefore the public perception of its fairness is of paramount importance. Arbitrators appointed to resolve securities controversies must meet the challenge of maintaining fair and orderly arbitration proceedings.

Ken StrongmanAbout the Author: Ken Strongman (www.kpstrongman.com) has years of experience and a growing national reputation as a mediator and arbitrator.  He has successfully resolved more than a thousand disputes in the fields of construction defects, real estate, intellectual property, and employment.  He is also a Mediator and Arbitrator for FINRA.

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