Should you discover wrongdoing, remember that time is critical.  Some statutes of limitations (the amount of time you have to bring a claim against the wrongdoer) begin from when the wrongdoing should have been discovered, and not necessarily the actual discovery.  If you suspect improprieties regarding your account, you should immediately investigate and if appropriate:

Consult with a securities attorney to educate yourself as to your legal rights.

Make a written complaint to your broker and his or her branch manager. Send the letter by certified mail with a return receipt request. Ask for an explanation of any transaction that is questionable. If you’re not satisfied with the explanation, estimate the amount of your loss resulting from that transaction and ask the branch manager for restitution.

Initiate binding arbitration proceedings if you don’t receive a response or resolution of the problem in a timely fashion.  Most New Account and Customer Agreement forms specify binding arbitration for dispute resolution and specify the forum to be used for the arbitration proceedings. For instance, your Agreement form probably specifies that you must arbitrate any and all claims before the Financial Industry Regulatory Authority (FINRA), or some other arbitration organization.

It would be prudent to consult with an experienced security lawyer before deciding how to proceed.  Though many guides to arbitration indicate that it is a do-it-yourself process, most often, that’s not the case. Brokerage firms almost always have their cases presented by securities attorneys, so you can be at a real disadvantage if you don’t have an experienced attorney representing your legal rights.

What Not to Do

What to Look For