Posts Tagged ‘Securities Arbitration’
Helen Kearney, of bankinvestmentconsultant.com recently reported that as of August 2009, more arbitration claims had been filed than in all of 2009. Although there was a slight downturn in the number of claims filed in August, it is unclear whether this trend will continue.
In large part, the number of claims will likely depend on what happens in the markets over the next few months. In addition, there are different types of investments that have been the subject of significant arbitration claims, including auction rate securities and other cash-equivalent funds. Some of these investments have also been the subject of regulatory investigations and settlements. The outcome of those pending investigations could impact the number of cases filed during the remainder of the year.
If you have concerns about the manner in which your investments have been managed, or if you are worried that an investment you own may not be what you thought you had invested your money in, you should contact an attorney to discuss your rights. The Kueser Law Firm represents individuals in securities arbitration. Feel free to contact us if you would like more information.
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InvestmentNews recently pubished two articles discussing recently filed securities disputes.
First, on August 19, Jeff Benjamin and Sue Asci reported that NBA star Carmelo Anthony filed a lawsuit in federal court against California adviser Larry W. Hamilton. The claim alleges that the adviser transferred $1.75 million of Mr. Anthony’s assets and invested an additional $265,000 with other companies without consent. The complaint seeks an accounting of the adviser’s books and records, $2 million in compensatory damages, and punitive damages. Mr. Anthony is represented by Robert Hirsch of Beverly Hills, California.
On August 20, Sara Hansard reported that a Freeport, Bahamas couple had filed a securities arbitration claim against Merrill Lynch. According to the article, the claim alleges that Merrill Lynch invested the couple’s money in unsuitable preferred stocks issued by financial companies.
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According to the Financial Industry Regulatory Authority (FINRA), securities arbitration claims are on the rise in 2009. In fact, according to FINRA’s June Summary Arbitration Statistics, the self-regulatory organization anticipates that 56% more cases will be filed during the year, as compared to 2008 and that during the first six months of 2009, 82% more cases had been filed as during the same period in the previous year. During this same period, FINRA reports that fewer cases are going to mediation.
FINRA also reports that cases are being turned around in a shorter amount of time in 2009 as compared to 2008 and 2007. As of June 2009, the average overall turnaround time for claims filed in FINRA arbitration is 11.9 months (13.5 in 2007 and 13.2 in 2008). The turnaround time for cases that go to hearing is 14.7 months.
The most prevalent claims in securities arbitration claims are: (1) breach of fiduciary duty (4,432 claims); (2) Misrepresentation (3,530 claims); and (3) Negligence (3,404 claims). The most common securities at issue in arbitration claims are mutual funds (892 claims) and common stock (689 claims).
The results of securities arbitration claims have also been more favorable for investors/claimants than in 2008. However, Claimants still prevail in fewer than 50% of all arbitration claims decided by an arbitration panel. During the first six months of 2009, 138 of 298, or 46% of Claimant cases closed resulted in an award of damages to the investor. In addition, 50% of arbitration cases closed during the first six months of 2009 were settled by the parties (45% by direct settlement and 5% through mediation).
The Kueser Law Firm represents investors in securities arbitration. If you feel that your investments have been mismanaged, please contact our firm to discuss your rights.
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