The first half of the year has officially come to a close; can you guess what the most common type of allegations filed by investors with FINRA’s arbitration forum were? While many repeat allegations were on the list, this was the first time we saw complaints tied specifically to Reg BI.
The top 15 controversy types by number of complaints were*:
- Breach of Fiduciary Duty (594)
- Negligence (540)
- Failure to Supervise (472)
- Breach of Contract (444)
- Misrepresentation (436)
- Suitability (416)
- Omission of Facts (344)
- Fraud (310)
- Violation of Blue Sky Laws (155)
- Manipulation (109)
- Elder Abuse (77)
- Unauthorized Trading (75)
- Regulation Best Interest (54)
- Errors-charges (49)
- Execution Error (37)
*A single arbitration case may include multiple controversy types. This data includes complaints through June (data pulled July 18, 2022).
So far this year, there have been 1,260 new cases filed, which is down 22% from the previous year at this time. Of that number, 781 (62%) are customer related, whereas 479 are intra-industry (38%). In 2021, FINRA ended the year with 2,893 cases filed.
Since the postponement of in-person hearings, and as of June 30, 894 arbitration cases have conducted one or more hearings via Zoom (378 customer cases and 516 industry cases). There are 646 total joint motions for virtual hearings. (278 in customer cases and 368 in industry cases).
To learn more about FINRA’s dispute resolution data, click here.