{"id":9200,"date":"2020-07-29T16:42:21","date_gmt":"2020-07-29T20:42:21","guid":{"rendered":"https:\/\/www.silverlaw.com\/blog\/?p=9200"},"modified":"2020-07-29T16:42:21","modified_gmt":"2020-07-29T20:42:21","slug":"finra-arbitration-what-is-a-product-case","status":"publish","type":"post","link":"https:\/\/www.silverlaw.com\/blog\/finra-arbitration-what-is-a-product-case\/","title":{"rendered":"FINRA Arbitration \u2013 What Is A Product Case?"},"content":{"rendered":"<p><img loading=\"lazy\" decoding=\"async\" class=\"alignleft wp-image-8809 size-medium\" src=\"https:\/\/www.silverlaw.com\/blog\/wp-content\/uploads\/2020\/01\/Gavel6-300x200.jpg\" alt=\"The Financial Industry Regulatory Authority (\u201cFINRA\u201d) provides an arbitration process for investors to resolve disputes with their securities advisors. Among other things, the FINRA arbitration process helps parties avoid the expenses and waiting periods associated with filing a case in state or federal court. FINRA also writes special rules and regulations specially tailored to these investment-related disputes. As commissions on trading stocks has gone to zero, Wall Street has replaced recommending stocks with a large number of high commission alternative investments or \u201cproducts\u201d which can be complex for the average investor but lucrative for Wall Street. Over the last decade, we have seen a substantial rise in product cases for the sale of investments which were sold without disclosure of the fees or risks or alternative investments which failed to perform the way the investment was designed. Frequently, risks and costs are buried deep in the paperwork and products are falsely sold as alternatives to the stock market with reduced risk. FINRA Provides Special Guidance For Arbitrations Concerning Bad \u201cProducts\u201d Unfortunately, many investors suffer losses due to broker-dealer firms failing to conduct sufficient due diligence on investment products before recommending them to customers. These \u201cproducts\u201d include private placements, real estate investment trusts (\u201cREITs\u201d), and busines development companies (\u201cBDCs\u201d). It is often the case that the company managing the product pays the broker a high commission to recommend the investment, incentivizing broker-dealer firms to sell the product in high volumes to a multitude of customers, all without properly investigating the investment. When things fall apart and the value of the investment plummets, the investors are left alone to pick up the pieces, often suffering substantial losses and prolonged illiquidity.\" width=\"300\" height=\"200\" srcset=\"https:\/\/www.silverlaw.com\/blog\/wp-content\/uploads\/2020\/01\/Gavel6.jpg 300w, https:\/\/www.silverlaw.com\/blog\/wp-content\/uploads\/2020\/01\/Gavel6-180x120.jpg 180w\" sizes=\"auto, (max-width: 300px) 100vw, 300px\" \/>The Financial Industry Regulatory Authority (\u201cFINRA\u201d) provides an arbitration process for investors to resolve disputes with their securities advisors. Among other things, the FINRA arbitration process helps parties avoid the expenses and waiting periods associated with filing a case in state or federal court. FINRA also writes special rules and regulations specially tailored to these investment-related disputes. <a href=\"https:\/\/www.silverlaw.com\/blog\/finra-arbitration-what-is-a-product-case\/#more-9200\" class=\"more-link\">Continue reading \u203a<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>The Financial Industry Regulatory Authority (\u201cFINRA\u201d) provides an arbitration process for investors to resolve disputes with their securities advisors. Among other things, the FINRA arbitration process helps parties avoid the expenses and waiting periods associated with filing a case in state or federal court. FINRA also writes special rules and regulations specially tailored to these [&hellip;]<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[588,590],"tags":[],"class_list":["post-9200","post","type-post","status-publish","format-standard","hentry","category-finra-arbitration","category-misrepresentation-and-omission-of-material-facts"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.4 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>FINRA Arbitration \u2013 What Is A Product Case?<\/title>\n<meta name=\"description\" content=\"Over the last decade, we have seen a substantial rise in product cases for the sale of investments which were sold without disclosure of the fees or risks.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link 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