Talk to Your Broker Prior to Filing a Claim

Arbitration and mediation are important methods of dispute resolution that have been used successfully by the securities industry and others, but they generally should not be your first steps.

In the event that a discrepancy or dispute arises, your first course of action should be to report the matter in writing to your broker's manager or the brokerage firm's compliance personnel. If you make your initial complaint over the telephone, you should confirm your complaint to the brokerage firm in writing and keep written records of all conversations, including names, dates and times of your calls. Often, the brokerage firm's management has the authority and insight to take steps that will rectify the problem quickly and easily. If it is just a misunderstanding, management intervention may be enough to put the transaction back on course.

However, if you are not satisfied with the response, or want to seek monetary damages or other restitution, you may initiate more formal dispute resolution processes.