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Securities FAQ

What is Arbitration?
Arbitration is a means of resolving disputes between two parties. Arbitrators are independent and impartial individuals who hear the dispute. Arbitration occurs when two parties present their side of a dispute to one or more arbitrators who will, after listening to and reviewing the evidence presented by both parties, render a binding decision.

Why Arbitration?
Many broker and brokerage firm contracts stipulate arbitration as the mandatory dispute resolution process. The United States Supreme Court upheld these contracts by rendering a landmark decision where it held that pre-dispute contracts to arbitrate securities claims are enforceable. As with any document you sign, you need to thoroughly read and understand the contract prior to signing it. Broker and brokerage firm contracts may indicate if arbitration is the required process should there be a dispute.

Are You Required To Have An Attorney Represent You In Arbitration?
Individuals involved in an arbitration are not required to have legal representation. You may represent yourself. It should be noted, however, that many brokers and brokerage firms will be represented by legal counsel and it may be in the claimant's best interest to consult with legal counsel.

What is Mediation?
Mediation is a voluntary process utilized to facilitate negotiations between disputing parties in an effort to reach a mutually acceptable solution. A mediator is an impartial individual who acts to facilitate the negotiations. Mediation offers the parties an early opportunity to settle their dispute. Unlike arbitration, mediation is non-binding. Should the conflicting parties be unable to settle their differences in mediation, they may still arbitrate or litigate their dispute.

Investor Bill of Rights

When You Invest, You Have the Right to:
1. Ask for and receive information from a firm about the work history and background of the person handling your account, as well as information about the firm itself.

2. Receive complete information about the risks, obligations and costs of any investment before investing.

3. Receive recommendations consistent with your financial needs and investment objectives.

4. Receive a copy of all completed account forms and agreements.

5. Receive account statements that are accurate and understandable.

6. Understand the terms and conditions of transactions you undertake.

7. Access your funds in a timely manner and receive information about any restrictions or limitations on access.

8. Discuss account problems with the branch manager or compliance department of the firm and receive prompt attention to and fair consideration of your concerns.

9. Receive complete information about commissions, sales charges, maintenance or service charges, transaction or redemption fees, and penalties.

10. Contact the Securities Division in order to verify the employment and disciplinary history of a securities salesperson and the salesperson's firm; find out if the investment is permitted to be sold; or file a complaint.

Matthew H. Maschler, a lawyer in Boca Raton, Florida, is the owner of Matthew H. Maschler, Attorney at Law. Attorney Maschler practices law in Boca Raton, Florida in such areas as residential real estate law, securities law and general corporate governances. Attorney Maschler also involved in many matters related to legal disputes, real estate law, securities law, arbitration law, bankruptcy law and municipal law. Attorney Maschler is a member of the New York, New Jersey and Florida Bar.

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