How the SEC Handles Your Complaint
Dec. 2, 2009
The SEC created the Office of Investor Education and Advocacy (OIEA) to serve individual investors. We are ready to assist you in resolving complaints, answering questions, and making sure that investors’ problems and concerns are known and considered when we take action.
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Complaints Handled by OIEA
OIEA receives many types of complaints, including complaints against brokers, brokerage firms, investment advisers, transfer agents, mutual funds, and other market participants.
How OIEA Handles Your Complaint
When we receive an investor's complaint, we take the following steps:
- We analyze the complaint and decide whether to refer it to other offices or divisions within the SEC, including the Division of Enforcement. We may also decide to refer a complaint to a state or another federal regulator.
- Depending on the nature of your complaint, unless you tell us otherwise, we may send a copy of your complaint to the firm involved and ask the firm to send a written report to you and us that addresses the issues raised in your complaint.
The SEC generally conducts investigations on a confidential basis. As a result, the SEC will neither confirm nor deny the existence of any investigation and will not update you on the status of your complaint.
What We Do With Your Complaint
When you share information with OIEA, our principal use of that information is to track and resolve your complaint/inquiry/request, but we may also share that information with other offices and divisions in the SEC or outside of the SEC where appropriate. Records and information may be disclosed outside the SEC as a routine use pursuant to 5 U.S.C. 552a(b) for multiple purposes, including to assist with SEC examinations and enforcement to determine whether an entity or person is complying with, or has violated, the federal securities laws, and to other federal, state, and local law enforcement or regulatory agencies. Information that OIEA gathers is governed by our Privacy Act System of Records Notice (SORN SEC 65, Investor Response Information System), which is published and updated regularly. Please read our Web Site Privacy and Security Policy to learn more about how we may use the information you send to us.
Our Limitations - What We Can and Cannot do for You
Our efforts to facilitate informal resolutions of complaints often succeed. In some cases, however, an entity may deny wrongdoing or it may remain unclear whether any wrongdoing occurred. If that happens, we cannot act as a judge or an arbitrator and force a broker, brokerage firm, or investment adviser to resolve your complaint to your satisfaction. Nor can we act as your personal representative or attorney. But we can provide you information on how to pursue your complaint on your own.
How to Resolve a Problem on Your Own
If you wish to resolve the problem yourself, rather than contacting OIEA, talk to your lawyer or follow these steps:
Note: If you believe your broker engaged in unauthorized transactions or other fraud, 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" at.
- Talk to your broker or adviser and explain the problem.
- If your broker or adviser cannot resolve your problem, then talk to the branch manager.
- If the problem is still not resolved, write to the firm’s compliance department. 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 are still not satisfied, contact OIEA or one of the following 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 form at . You may also write, fax or telephone us with your complaint.
- FINRA (Financial Industry Regulatory Authority). FINRA regulates most securities firms and brokers. You can find FINRA's regional office contact information on its website at . You can also fill out a complaint form on FINRA's website at .
- Your state's securities administrator. You can find links and addresses for your state regulator on the North American Securities Administrators Association's website at .
More Complaint Options
When informal attempts to resolve complaints do not succeed, OIEA can provide information on other alternatives. 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 limitation" vary from state to state. Federal securities laws generally require you to 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.
Arbitration and Mediation Against Brokers and Their Firms
If you have a brokerage account, you probably agreed to settle all disputes with your broker or firm through arbitration. But even if you did not, you may choose to use arbitration to settle disputes. If you use arbitration, 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 arbitrate - or, if it is a choice, to sue in court - bear in mind that if your broker or brokerage firm goes out of business or declares bankruptcy, you might not be able to recover your money - even if the arbitrator or court rules in your favor.
The majority of securities arbitration claims are filed with FINRA Dispute Resolution Inc. To obtain information about how to file an arbitration claim, contact the Director of Arbitration at:
FINRA Dispute Resolution
One Liberty Plaza
165 Broadway, 27th Floor
New York, NY 10006
Phone: (212) 858-4400
or go to
. 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. 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. Mediation is another option to consider. Mediation may allow you to save time and money because it is quicker than arbitration and voluntary. You can learn more about mediation at
. If you cannot reach an agreement through mediation, you can still go to arbitration. Information about mediation can also be found online at FINRA's website at
Broker-dealers cannot use confidentiality provisions to prohibit or restrict an individual from communicating with the Commission, FINRA, or other securities regulators. More specifically, FINRA Rule 2010 (Standards of Commercial Honor and Principles of Trade) prohibits broker-dealers from using confidentiality provisions in settlement agreements, discovery stipulations in arbitration proceedings, or any other documents that prohibit or restrict a customer or any other person from communicating with the Commission, FINRA, or any federal or state regulatory authority regarding a possible securities law violation.
How Do You Find a Lawyer Specializing in Securities?
If you need help 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.
- Call your state or local bar association 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 is also available online at . It lists lawyers by state and jurisdictions.
For your convenience, we have listed the following contact information for two bar associations that may provide you with referrals in your area. This is not a complete list, so 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
Phone: (800) 285-2221 (toll-free)
The American Bar Association will provide you with the name, address, and phone number of a referral service in your area. This free service is available at
Public Investors Arbitration Bar Association (PIABA)
2415 A Wilcox Drive
Norman, OK 73069
Phone: (888) 621-7484 (toll-free)
Fax: (405) 360-2063
Email: email@example.com; website
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 telephone 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 available at