Where We Handle FINRA Arbitrations Against Wachovia

Why Securities Arbitration For Cases Against Wachovia?

Since the late 1980s, brokerage firms like Wachovia have forced clients to resolve disputes with them through binding securities arbitration. Buried deep in client’s new Wachovia account agreements is a binding arbitration clause. This clause states if you want to pursue your investment losses or recover for investment fraud at Wachovia Securities, you must do it through binding securities arbitration at the NASD (now called FINRA). If as a Wachovia client you filed a complaint or lawsuit in state or federal court, Wachovia’s attorney or law firm would go into court and present the binding arbitration clause the client agreed to and the investor would be forced into filing a statement of claim through binding securities arbitration at FINRA.

What is Securities Arbitration Against Wachovia?

Securities arbitration is a method of having a dispute between a brokerage firm like Wachovia and its client resolved by impartial persons who are knowledgeable in the securities areas in controversy. Those persons are called arbitrators. FINRA arbitration actions of disputes with broker/dealers like Wachovia has long been used as an alternative to the courts and lawsuits because it is a prompt and inexpensive means of resolving complicated issues. There are certain laws governing the conduct of an securities arbitration proceedings against brokerage firms like Wachovia that must be considered by those planning to use FINRA arbitration to resolve the dispute. Most importantly, perhaps, is the fact that a FINRA arbitration award against Wachovia is final and binding, subject to review by a court only on a very limited basis.

How Much Can Be Recovered in Arbitrations Against Wachovia?

The most basic remedy for damages against Wachovia in FINRA arbitration are out-of-pocket losses. The out-of-pocket loss is generally the amount of money invested by the Wachovia client minus the returns and the residual value of the investment at Wachovia. The out-of-pocket measure is also generally the smallest measure of damages, so it is important not to limit yourself to it. In addition to out-of-pocket losses, a Wachovia client with an arbitration action against the firm in FINRA arbitration may be awarded damages based on the profits he would have made had the wrongful act not occurred. These lost profits are recoverable in some FINRA cases but it is very fact specific to each case. FINRA arbitrators in lawsuits against Wachovia have the power to award punitive damages and may do so where the facts warrant them and they are satisfied that there is an adequate basis in law to do so. Punitive damages against Wachovia or its financial advisors may be any amount and they are to punish Wachovia and to deter future misconduct. Punitive damages are relatively rare in FINRA NASD arbitrations in general and Wachovia in particular but they are awarded to some clients if the activity is egregious enough like in a failure to supervise case. The most common basis for an award of attorney fees in FINRA arbitrations is either by contract or statute. In addition, certain states, such as Illinois, Wisconsin, Michigan, Indiana, California, Iowa, Texas, Alabama, and Florida, have statutory provisions that allow attorneys fees, interest and costs to be awarded in certain securities arbitrations and lawsuits. Some customer agreements have an attorneys' fee provision in the investor's account agreement. Of course, the fact that a particular kind of damages may be available does not necessarily mean that you will be able to convince the FINRA arbitrators, court, or jury to give it to you. However, we will request that the panel award all appropriate damages.

How Much are the Attorney Fees In FINRA Arbitrations Against Wachovia?

Our law firm will first provide you a free case evaluation as to whether we believe we can recover your investment losses against Wachovia. Then, if we believe you have a valid FINRA arbitration claim against Wachovia or its stockbrokers, we handle most cases on a contingency fee basis. This means that if no money is recovered through the arbitration process against Wachovia from your claim, you will owe nothing to the law firm for attorney's fees. However, if there is money recovered in arbitration, the client agrees to pay the law firm a fee from the gross proceeds of any recovery. Typically this amount ranges between 33.3% and 40%.

Are There Expenses in FINRA Arbitrations or Lawsuits?

Yes. If the client recovers in arbitration against Wachovia, there will typically be expenses to be paid. These are usually between $5,000-$10,000. Often, Stoltmann Law Offices will cap these in writing in the engagement agreement. Importantly, if there is no recovery in FINRA arbitration against Wachovia securities, then the client does not have to reimburse the law firm for the costs it has incurred. The costs and expenses are separate and apart from the attorneys' fees. Costs and expenses in arbitration include, but are not limited to photocopy charges, postage, couriers and accountant/expert fees to prepare and review damage reports. We do not mark up any of the expenses but rather charge the client the actual costs of these expenses. Remember, the law firm will not invest its time and money in a case unless we truly believe we can recover on your behalf.

What Will it Cost Me to File an Arbitration Claim with FINRA Against Wachovia?

When you arbitrate at FINRA against Wachovia, there will be a filing fee and deposit based on the size of your investment losses. The fees with FINRA arbitrations against Wachovia run anywhere from $475 for a claim between $10,000 to $25,000 up to $1,800 for claims over $1 million.

Where Do Wachovia NASD Arbitration Hearings Occur?

All arbitrations against Wachovia are conducted by FINRA (formerly known as NASD). FINRA hires independent arbitrators, usually lawyers or business people, who sit and hear your case and render a decision. They will conduct a hearing. Each side will have a chance to tell its story at the arbitration and there will be cross-examination. Most FINRA arbitration cases are handled in the largest city closest to your home. The arbitration hearing will occur in an office building or hotel and not a courthouse. It could last several days.

Do Some FINRA Arbitration Actions Against Wachovia Settle?

Yes. A majority of all arbitration claims filed at FINRA typically settle without the arbitration hearing being held. This is also true of FINRA arbitration complaints filed against Wachovia.

Who are the Arbitrators at FINRA?

FINRA arbitrators are impartial persons who are knowledgeable in securities industry disputes. FINRA maintains a roster of individuals whose professional qualifications and experience qualify them for service as arbitrators. The FINRA arbitrators are not employees of FINRA (or the NASD) and they, not FINRA, will decide your arbitration claim. An important job of your attorney will be choosing the FINRA arbitrators carefully. Both parties will have an ability to rank the arbitrators and strike certain ones. The combined rankings will be used to choose the arbitrators.

Are the FINRA Arbitrators Affiliated With Wachovia?

No. The FINRA arbitrators are neutral. They can not be affiliated with Wachovia in any manner.

How Is an Arbitration Against Wachovia Begun?

To begin a FINRA securities arbitration against Wachovia, the investor claimant must do the following tasks listed below. Stoltmann Law Offices PC handles these tasks for clients.

1. Statement of Claim
File with the FINRA Director of Arbitration a typewritten or printed document stating the claim against Wachovia. This document should set forth the details of the dispute, in a clear, concise, and chronological fashion and should conclude by indicating what relief (e.g., money damages in a specific amount, performance of a particular agreement, interest, etc.) is requested against Wachovia or the firm’s brokers or employees. The Wachovia claimant should attach copies of documents and supporting materials as exhibits to the Statement of Claim. The Wachovia claimant should provide sufficient copies for each party, the arbitrators, and the self-regulatory organization.

2. Small-Claims Procedures
FINRA has a simplified arbitration process for claims in the amount of $25,000 or less. In public customer disputes with Wachovia, unless the public customer requests a hearing, the claim will be decided solely on the basis of reading the parties' submissions. The FINRA arbitrator, however, also may request a hearing or require a party to submit additional documentation. Parties may ask to submit additional documents to an arbitrator who is deciding the case without a hearing.

3. Service of Pleadings
After the initial Statement of Claim is served by the FINRA Director of Arbitration on Wachovia, it is each party's responsibility to provide every other party directly with any further pleadings, motions, and/or correspondence. In addition, it is each party's responsibility to simultaneously provide sufficient copies directly to FINRA for the arbitrators and its files. Service of the filings and correspondence on FINRA and Wachovia should be made on the same date and by the same means (i.e., via overnight mail, facsimile, etc.)

4. Counsel
State whether the investor claimant will be represented by an attorney and, if so, the attorney's name, address, and telephone number.

5. Location
State where the investor claimant wants the case to be heard and the reasons for that choice. The decision as to the location of the initial hearing is made by the FINRA Director of Arbitration. Consideration generally will be given to a number of factors, including the convenience of the parties, the availability of necessary records or witnesses, and the availability of qualified arbitrators. In customer cases, the hearing will generally be in a major urban area near where the investor customer resided when the dispute arose unless the parties agree to a different location after the case is filed.

6. Complex Cases
In appropriate cases against Wachovia LLC, parties may request special services such as mediation, findings of facts and conclusions of law, expedited hearings, and the appointment of arbitrators with special qualifications. Investors seeking special or additional services should advise FINRA at the earliest time possible. In many complex cases against Wachovia, the parties may desire block scheduling of hearing dates.

7. FINRA Arbitrators
The proposed FINRA arbitration panel will be composed of a majority of persons from outside the securities industry. If a customer would like a panel consisting of a majority of arbitrators from the securities industry, he or she should indicate that preference in writing when filing the claim.

8. Submission Agreement
Complete and return three signed and notarized copies of the FINRA Submission Agreement. The investor claimant should provide sufficient copies for each party, the arbitrators, and the self-regulatory organization. By signing the Submission Agreement, the FINRA claimant agrees to submit the dispute to arbitration and to abide by the decision (the "award") of the arbitrators. Once a Submission Agreement has been signed, the procedures and timing set out in the Uniform Code become operative and binding. Generally, parties may not withdraw the FINRA Submission Agreement and Claim without the consent of either the other parties or the arbitrators.

9. Filing Fees and Deposits
Include a check or money order made payable to FINRA for the appropriate non-refundable filing fee and hearing session deposit. Where multiple hearing sessions against Wachovia are scheduled or conducted the arbitrators are authorized to require additional hearing session deposits by one or more parties.

10. Documents Requested to be Produced in Customer Securities Cases
In bringing an arbitration claim, customers and brokerage firms like Wachovia Securities are required to exchange documents through what is called the discovery process. The NASD in 1999 compiled a list of documents that customers and brokerage firms must produce to each other in securities claims involving customer disputes.

What is Mediation Against Wachovia?

Mediation is an informal, voluntary process against Wachovia in which an impartial person, trained in facilitation and negotiation techniques, helps the parties reach a mutually acceptable resolution. What distinguishes FINRA mediation from other forms of dispute resolution, principally, arbitration and litigation, is that the mediator does not impose a solution but rather works with the parties to create their own solution. Mediated solutions often include relief not available in arbitration or litigation.

Mediation is flexible and creative. The actual process varies from case to case depending largely on the parties' needs and the mediator's style. Usually, the parties (the investor and Wachovia) meet to discuss the issues face-to-face. The mediator helps the discussions remain focused and productive. Then, the FINRA mediator may hold private caucuses with each party separately, and will carry messages, clarifications, questions, proposals, offers, and counter offers, back and forth between them. The mediator uses the private caucus and other techniques to facilitate the negotiation.

Mediation against Wachovia is non-binding. The emphasis is on fashioning a solution satisfactory to all. However, if the parties cannot negotiate an acceptable settlement, they may still benefit from the process by narrowing the issues to be arbitrated or litigated.

What Are The Benefits Of Mediation Against Wachovia?

• Control—FINRA Mediation belongs to the parties. The disputing parties control the process, scheduling, costs, and outcome of the dispute.
• Less Adversarial--The FINRA mediation process is informal. It is less confrontational than arbitration or litigation.
• Preserves Options--Parties can enter into mediation without jeopardizing their option to arbitrate or litigate.
• Swift Settlement--Most FINRA mediations are successfully concluded in a single day. Since mediation can be scheduled soon after a dispute arises, parties reach settlement much earlier than in arbitration or litigation. Many mediations conclude before a formal arbitration claim is filed.
• Lower Cost—FINRA Mediation usually entails lower legal and preparatory costs, there is minimal interruption of business or personal life, lost productivity is kept to a minimum, and the fees and expenses of mediation are modest.
• Preservation Of Business Relationships--By reaching an early resolution with minimal financial or other strain on either party, the chances for preserving business relationships with Wachovia are greatly enhanced If this is desired).
• Protects Privacy—FINRA Mediation offers greater confidentiality than arbitration.
• Creative Solutions—FINRA Mediators help the parties craft creative solutions.
• Low Risk--Settlement potential with Wachovia is high. The case proceeds quickly. The cost is modest and there are benefits even if a settlement is not reached.

How Successful Is Mediation against Wachovia?

Historically, parties in FINRA securities arbitration settle most business disputes submitted to mediation. At Stoltmann Law Offices, approximately 90% of the cases we mediate lead to a settlement. Mediation experts would attribute this to the parties' control over the process, costs, and outcome. The parties approach the process with confidence, leading to successful resolutions. We have resolved through mediation multiple claims against Wachovia.

FINRA Mediation is valuable even when the parties do not reach full settlement. Sometimes parts of a dispute are resolved in mediation, leaving fewer or less extreme differences to be resolved in arbitration or litigation. Gaining agreement on collateral issues can translate into significant savings of time and money for everyone involved.

The mediation process against Wachovia improves communications, narrows outstanding issues, defuses emotions, and defines areas of agreement. Through the mediation process, the parties and their representatives also learn where to focus their energies should arbitration or litigation become necessary. Therefore the parties' future dispute resolution efforts become more efficient.

What Happens in a Mediation Session Against Wachovia

A Wachovia FINRA Mediation typically consists of a joint session involving all participants as well as separate private sessions between the mediator and each party. Before the start of the mediation, most mediators require parties to sign the Mediation Submission Agreement.

The joint session against Wachovia may start with an opening statement by the mediator. The mediator explains the framework of the session, encourages active participation, and reminds all parties of the shared goal of resolving the conflict and of the confidentiality of the settlement negotiations. In the joint session, the mediator gives each party the opportunity to make a presentation and asks for a commitment by all participants to work hard toward resolution.

Party presentations, including that of Wachovia’s counsel, generally address facts, liability, and damages, as well as background information, key issues, and needs. The tone is one of respectful communication. Each presentation is directed to the mediator and to the other side. Participants do not provide sworn testimony and are not subject to cross-examination. At the conclusion of the presentations, the FINRA mediator may ask clarifying questions.

The second stage of the FINRA Mediation may then involve meetings, or "caucuses," held by the mediator privately and separately with each party. Caucuses are confidential so that each party can be open and candid about the case. Only if a participant grants permission will the mediator reveal information disclosed in these private sessions. This gives the mediator the opportunity to help the parties examine strengths and weaknesses of the case, analyze risks objectively, and develop options for resolution. The mediator explores each party's needs and underlying interests in resolving the dispute. Through a series of caucuses, the mediator can compare settlement expectations, facilitate the exchange of settlement offers, and help the parties reach common ground.

It is critical to the success of any mediation process that all individuals with authority to resolve the dispute attend the mediation session with Wachovia. The failure to bring parties or representatives with authority to settle will hamper the efficiency of mediation. Neither the parties nor the mediator may disclose anything said during the mediation in any other proceeding, unless authorized by all other parties or compelled by law. No verbatim or other record is made of
mediation sessions.

Glossary Of Terms
Answer – Wachovia’s written reply to a FINRA arbitration complaint.
Arbitrator - A person chosen to decide disputes between parties.
Award - The written determination of the arbitrator(s) against Wachovia.
Claim - A demand for money or other relief against Wachovia.
Claimant - A person making a claim against Wachovia Securities.
Counsel - An attorney who advises and represents a party in an arbitration.
Cross-Claim - A claim by a respondent against a co-respondent previously named by the claimant.
Filing - Delivery to the FINRA Director of Arbitration of the statement of claim or other pleadings, to be kept on file as a matter of record and reference.
FINRA-The organization that administers the securities arbitration process.
Lawsuit-This term is often used interchangeably with a securities arbitration claim against Wachovia. A lawsuit against Wachovia is typically filed in court while a statement of claim if filed in arbitration.
Panel - The FINRA arbitrator(s) who decide(s) a dispute.
Party - A person or broker/dealer making or responding to a claim in an arbitration proceeding against Wachovia.
Pleadings - The claim, answer, counterclaim, and/or third-party claim and/or cross-claim filed in an arbitration.
Respondent - The person or company (Wachovia) against whom a claim is made.
Service - Delivery of the statement of claim or other pleadings to those parties named in the arbitration.
Third-Party Claim - A claim by the respondent Wachovia against a party not already named in the proceeding.