How Edward Jones Broker Fraud Arbitration Works

Edward Jones broker fraud and financial misconduct often leave investors feeling hopeless. In the aftermath of churning, unauthorized trading, or portfolio mismanagement, you may not know where to begin in addressing your losses. The Financial Industry Regulatory Authority (FINRA) offers investors an alternative to the lengthy civil litigation process through arbitration. FINRA arbitration is a simplified and generally quicker means of resolving claims of broker misconduct.

If you have an Edward Jones broker fraud claim, a securities fraud attorney can assist you through the arbitration process, from claim filing to representing you during your hearing.

A Kurta Broker Fraud Attorney can provide free case evaluations for investors who believe their losses are the result of broker misconduct.

How Does FINRA Arbitration Differ from Civil Court?

Many investors assume they will need to file a broker fraud claim in civil court. However, most brokerage firms have a clause in their account opening agreements that requires investors to resolve their claims through FINRA arbitration instead. FINRA arbitration generally provides a resolution in 12 to 18 months, but this depends on the complexity of your case. Overall, arbitration is typically a quicker process than a civil proceeding.

FINRA arbitration differs from civil court in several major ways:

• No jury
• One or three arbitrators decide on your case
• Relatively limited discovery and appeals

The Edward Jones broker fraud arbitration process involves the same basic structure each time. While arbitration is not as rigid as civil court, allowing an investment fraud lawyer to represent you is the best way to ensure the process goes smoothly.

Investors who suspect broker fraud should contact our securities fraud attorney firm immediately for an in-depth case evaluation.

Preparing for Edward Jones Broker Fraud Arbitration

Your first step in preparing your Edward Jones broker fraud claim is to assemble as much documentation as possible. An investment fraud lawyer will conduct a thorough review of your account, combing through your available documentation for signs of misconduct.

Relevant documents often include:

• Trade confirmations
• Broker communications, e.g., texts and emails
• Account statements
• Account opening documents
• Prospectuses and investment disclosures

This documentation forms the foundation of your claim. In particular, your account opening documents and investor profile will contain crucial information about your risk tolerance, net worth, and financial goals that can support your case.

A Kurta broker fraud attorney will scrutinize the documents you collect for evidence of regulatory violations and create a timeline for your allegations. Here, you will discuss whether arbitration is the right way forward for your case.

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Filing Your Claim

Your next step is filing your claim with FINRA Dispute Resolution Services. Your Statement of Claim should thoroughly state the facts of your case, with specifics such as names, dates, and other details. In some cases, failing to describe something relevant in your Statement of Claim may waive your right to address it later in the arbitration process.

You also need to state your requested remedies. Most often, this refers to your damages and how they relate to the financial harm done. For example, an investor might request reimbursement of funds spent on an unauthorized trade.

An investment fraud attorney will ensure that you file your claim correctly with all the relevant documents, including your Submission Agreement. This agreement shows that you agree to the arbitration rules and that FINRA has jurisdiction over your claim. You will likely also have to pay some filing fees when you file your claim.

Firm Response

The firm will file a Response to your Statement of Claim, addressing your allegations and defending itself and the broker.

Firms frequently defend alleged misconduct by claiming:

• Losses were market-driven
• Investor’s own mistakes led to losses
• Trades or strategies were suitable
• All risks were disclosed and accepted

These defenses will be tested during arbitration. In rare cases, Edward Jones may request that a claim be dismissed, but most claims proceed to the next stage.

Document Exchange

During the document exchange phase, the two parties can request documents from each other. Discovery in FINRA arbitration is more limited than in civil court, which leads to a more streamlined discovery process.

Firms often make settlement offers during this stage as they learn more about the extent of your evidence and the firm’s potential liability for failure to supervise.

Selecting Arbitrators

In this phase, FINRA will provide both parties with a list of arbitrators. Public arbitrators are those without specialized financial industry experience; non-public arbitrators have experience in the industry. An investment fraud lawyer can apply their experience to select favorable arbitrators for your case.

The parties will select either one or three arbitrators, depending on the damages requested in the Statement of Claim. Once your arbitrators have been selected, your hearing will be scheduled.

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Hearing and Arbitration Award

Before the hearing, the two parties will exchange pre-hearing information. This involves disclosing the witnesses they will call and exchanging copies of the exhibits they will use. This typically happens about 20 days prior to the hearing.

The hearing begins with opening statements from both sides, then moves to the presentation of evidence and witness testimony. Expert witnesses called by each side will testify, and the parties’ attorneys have the opportunity to cross-examine them. The arbitration panel may also ask questions to witnesses at this time.

This is your opportunity to present the full narrative of broker misconduct to the arbitrators, supported by financial analysis by your witnesses. For example, a witness may present an analysis of the turnover rate and cost-to-equity ratio of an investor’s account to support a churning claim. This testimony will then be used as part of the evaluation of the requested damages.

The hearing ends with closing arguments by both sides. Hearings typically take two to five days to complete.

Within 30 days of your hearing, the panel will issue an arbitration award. Arbitrators may choose to award full or partial damages to an investor, or deny the claim completely. Arbitration awards are legally binding for both parties and can only be appealed in limited circumstances.

Evaluating Edward Jones Settlement Offers

Edward Jones may make a settlement offer before you complete the arbitration process. If you accept a settlement, your claim is resolved.

The firm may take several considerations into account when calculating your settlement:

• Strength of your documentation or witness testimony
• Possible liability for failure to supervise under FINRA Rule 3110
• Potential for negative press
• Damages requested

A securities fraud attorney can use their knowledge of broker misconduct, the financial harm you experienced, and their arbitration experience to negotiate a superior settlement.

It’s important for investors to know that a settlement offer from Edward Jones does not equal an admission of wrongdoing or firm liability in allegations of misconduct.

Do You Have an Edward Jones Broker Fraud Claim?

If you believe your broker may have engaged in unethical or fraudulent conduct, it’s vital to reach out to an investment fraud attorney as soon as possible.

The experienced attorneys at Kurta Law can identify patterns of misconduct across your documentation and build a compelling case in arbitration.

Contact Kurta Law for a free, in-depth case evaluation and discover your potential paths to resolution.