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Learn About the Costs Involved in Pursuing a Fraud Claim Against Your Broker in FINRA Arbitration
If you have a fraud claim against your broker, recovering your losses will most likely involve going to arbitration. The Financial Industry Regulatory Authority (FINRA) provides an arbitration forum for investors to resolve disputes with their brokers, and registered brokers have a legal obligation to participate in the arbitration process.
While going to FINRA arbitration is generally less costly and more efficient than filing a securities fraud lawsuit in court, there are still costs involved. But, these fees pale in comparison to the damages defrauded investors stand to gain in most cases. Here is an overview of some of FINRA’s main fees as well as some of the other potential costs involved in pursuing FINRA arbitration:
FINRA Arbitration Filing Fees
The cost to file for FINRA arbitration depends on the value of your claim. FINRA has adopted a graduated fee structure to ensure that all defrauded investors have access to the arbitration process. Currently, the filing fees for FINRA arbitration are:
- Claim for up to $1,000: $50
- Claim for $1,000.01 to $2,500: $75
- Claim for $2,500.01 to $5,000: $175
- Claim for $5,000.01 to $10,000: $325
- Claim for $10,000.01 to $25,000: $425
- Claim for $25,000.01 to $50,000: $600
- Claim for $50,000.01 to $100,000: $975
- Claim for $100,000.01 to $500,000: $1,425
- Claim for $500,000.01 to $1,000,000: $1,740
- Claim for $1,000,000.01 to $5,000,000: $2,025
- Claim for Over $5,000,000: $2,300
- Non-Monetary Claim or Amount of Claim Not Specified: $1,600
FINRA Arbitration Hearing Session Fees
In addition to the initial filing fee, investors must also pay hearing session fees when pursuing FINRA arbitration. These fees are also on a graduated scale. For hearing sessions with a single arbitrator, the daily fees are:
- Claim for up to $2,500: $50
- Claim for $2,500.01 to $5,000: $125
- Claim for $5,000.01 to $10,000: $250
- Claim for $10,000.01 or more: $450
- Non-Monetary Claim or Amount of Claim Not Specified: $450
For hearing sessions with a panel of three arbitrators, the daily fees are:
- Claim for up to $25,000: N/A
- Claim for $25,000.01 to $50,000: $600
- Claim for $50,000.01 to $100,000: $750
- Claim for $100,000.01 to $500,000: $1,125
- Claim for $500,000.01 to $1,000,000: $1,325
- Claim for $1,000,000.01 to $5,000,000: $1,435
- Claim for Over $5,000,000: $1,575
- Non-Monetary Claim or Amount of Claim Not Specified: $1,150
As FINRA notes, “[i]n the [final arbitration] award, the panel will determine the amount of each hearing session fee that each party must pay.” As a result, while it is possible that an investor will be responsible for paying these fees, it is also possible that the arbitrator or arbitration panel will order the investor’s broker or brokerage firm to cover the full cost of the hearing (in addition to compensating the investor for his or her fraudulent investment losses).
Other Costs of Pursuing FINRA Arbitration
Along with FINRA’s filing and hearing session fees, pursuing FINRA arbitration necessarily entails other costs as well. These include expert witness fees and legal fees, among others. In some cases, investors will need to pay these fees out of their awards if their claims are successful. But, FINRA’s Rules have provisions for including these costs in investors’ awards in certain circumstances as well.
Discuss Your FINRA Arbitration Claim with an Attorney at Zamansky LLC
If you need to know more about filing for FINRA arbitration, we invite you to get in touch. Our lawyers represent defrauded investors in FINRA arbitration cases nationwide. To speak with an experienced lawyer at Zamansky LLC in confidence, call 212-742-1414 or request a free consultation online today.