How the SEC Handles Your Complaint
The SEC created the Office of Investor Education and Advocacy specifically to serve individual investors. We want to make sure that the concerns and problems encountered by individual investors are known throughout the SEC and considered when we take action. We welcome hearing from you because your contact may be the one that alerts us to a bad broker or firm or an unfair practice in the securities industry that needs to be changed.
Have you checked our website?
We handle thousands of requests each month, so it will take some time before you receive an answer from us. If you need an answer right away, be sure to check Fast Answers first.
How long does it take the SEC to help you with your complaint?
We will usually be able to respond to you within a few days after the receipt of your complaint. If your complaint is complex, it may take a little longer. We appreciate your patience while waiting for our response.
Have you tried to resolve the problem directly with the person or company you are complaining about?
You should try to contact the person or company that is the cause of your complaint. You might be able to resolve your problem more quickly by speaking to them directly rather than waiting for a response to your complaint.
How should you handle a problem with your broker or adviser?
Act promptly! By law, you only have a limited time to take legal action. If you can't find a quick answer or solution to your investment problem on our website, talk to your lawyer or follow these steps to solve your problem:
Talk to your broker or adviser and explain the problem.
If your broker or adviser can't resolve your problem, then talk to the branch manager.
If the problem is still not resolved, write to the compliance department at the firm's main office. Explain your problem clearly, and tell the firm how you want it resolved. Ask the compliance office to respond to you in writing within 30 days.
If you're still not satisfied, contact one of these offices that oversee the securities industry:
The SEC's Office of Investor Education and Advocacy. If you have a complaint, please use our online complaint center.
- The nearest office of the Financial Industry Regulatory Authority (FINRA), which regulates most securities firms and brokers. You can also fill out a complaint form on FINRA's website.
- Your state's securities administrator. You can find links and addresses for your state regulator by visiting the North American Securities Administrators Association's website.
Note: If you believe your broker engaged in unauthorized transactions or other serious frauds, be sure to put your complaint in writing right away and send it to the firm. Your written complaint may be the only way to prove that you complained to the firm about unauthorized transactions. For more information about unauthorized transactions, please read our "Fast Answer" on that topic.
How will we handle your complaint?
We'll take the following steps when we get your complaint:
- We will analyze your complaint and decide if we need to refer it to our Division of Enforcement, another SEC office, or another regulator's office. Our Division of Enforcement conducts investigations, but our office does not. The SEC generally conducts investigations confidentially. As a result, the SEC will neither confirm nor deny the existence of any investigation.
- After analyzing your complaint, we will send a copy of the complaint to the brokerage firm or company. We'll ask the firm or company to send a written report to you and us that responds to your complaint.
Do you know what our limitations are?
Sometimes a complaint is successfully resolved when we ask a firm to report to you and us. But in many cases, the firm or company denies wrongdoing, and it remains unclear as to who is wrong or whether any wrongdoing occurred at all. If this happens, we cannot act as a judge or an arbitrator and force a broker, brokerage firm, or company to resolve your complaint. But the law allows you to take legal action on your own.
Do you know how you can take legal action on your own?
Both federal and state securities laws provide important legal rights and remedies if you have suffered wrongdoing. Acting on your own, you can seek to resolve your complaint through the courts, arbitration, or mediation.
To take advantage of these laws, you must take legal action promptly or you may lose the right to recover funds. Time restrictions, called "statutes of limitations," vary from state to state. Federal securities laws generally require that you bring a court action within two years of the date that you should have reasonably discovered the wrongdoing, but in no case later than five years from the date the wrongdoing actually occurred.
Do you know about arbitration and mediation?
If you have a brokerage account, you probably agreed to use only arbitration to settle all disputes with your broker or firm. But even if you did not, you may choose to use arbitration to settle disputes. If you use arbitration, then arbitrators will apply either a federal or state statute of limitations, depending on whether the claim involves a violation of federal or state law. You generally cannot pursue an issue through arbitration if it is more than six years old. For older cases, you will probably want to consult with an attorney. When deciding whether to arbitrateor, if it is a choice, to sue in courtbear in mind that if your broker or brokerage firm goes out of business or declares bankruptcy, you might not be able to recover your moneyeven if the arbitrator or court rules in your favor.
If you use FINRA Dispute Resolution, Inc. and your claim is $25,000 or less, you generally will not have to appear in person at a hearing and an arbitrator will make a decision on your case by reviewing documents and written descriptions of what happened from you and your broker. The New York Stock Exchange similarly has simplified arbitration procedures for claims below a $25,000 threshold. Simplified arbitration can be a less costly alternative because you typically do not have to travel to a hearing and appear in person to give testimony and answer questions. You should carefully review the rules governing simplified arbitration before you file a claim. Again, you should always weigh the costs of arbitrating against the likelihood of being able to collect any award in your favor, especially if the brokerage firm has left the industry or gone bankrupt. Firms that stay in business typically pay the arbitration awards levied against them, but defunct firms may not.
To obtain information about how to file an arbitration claim, you can contact the Director of Arbitration at one of the following organizations:
FINRA Dispute Resolution
One Liberty Plaza
165 Broadway, 27th Floor
New York, NY 10006
Phone: (212) 858-4400
Mediation is also an option you should consider before going to arbitration. Mediation may allow you to save time and money because it is quicker than arbitration and voluntary. If you can't reach an agreement through mediation, you can still go to arbitration. The FINRA Dispute Resolution has more information about mediation.
How do you find a lawyer specializing in securities?
If you need help in finding a lawyer who specializes in resolving securities complaints, you may want to try the following:
- If you already have a lawyer, consult your lawyer about your options and whether you need a lawyer who specializes in securities.
- You may want to call your state or local bar associations to obtain a listing of securities lawyers in your area. Many lawyers will offer to have an initial meeting with you for free or for a minimal fee.
- Broaden your list of potential securities lawyers by consulting directories of attorneys. The Martindale-Hubbell® Law Directory can be found at many libraries. It lists lawyers by state and jurisdictions.
For your convenience, we have listed below the names of some bar associations that may provide you with referrals in your area. This is not a complete list and you should check your telephone book for state, county, or city bar associations. We cannot endorse or recommend a specific lawyer to you, vouch for the competence of any lawyer recommended to you by a bar association or referral service, or recommend the services of one bar association over another.
American Bar Association
321 North Clark Street
Chicago, IL 60610
Phone: (312) 988-5522
Toll free: (800) 285-2221
Fax: (312) 988-3284
The American Bar Association will provide you with the name, address, and phone number of a referral service in your area. This is a free service.
This national bar association limits its membership to lawyers who specialize in representing individual investors in arbitration and other legal actions. Most PIABA members offer a free initial consultation either by phone or in person.
Law schools in several states have established clinics to provide legal representation to investors who cannot hire a lawyer to handle their securities arbitration and mediation claims. For information on how to contact these clinics, please read our "Fast Answer" on Arbitration/Mediation Clinics.
How do you learn more?
We also offer educational materials so you can understand how the securities industry works and how to avoid becoming a victim of securities fraud and abuse. Our educational materials provide tips on how you can make better investment decisions. You can order our free publications by calling (800) SEC-0330 or read them online at our website.
Thank you for taking the time to contact us. We hope this preliminary information has been helpful.