Mediation is a common method of dispute resolution enables the parties involved in a dispute to save substantial time and expense if the process proves successful in reaching a mutually acceptable resolution.
Mediation is an informal, voluntary, and non-binding process in which an independent and impartial mediator attempts to help the parties resolve a dispute.
As a general rule, securities mediation should only be initiated after the filing of a FINRA arbitration proceeding or a proceeding in federal or state court. The primary difference between mediation and a FINRA arbitration proceeding (or a proceeding in federal or state court) is the mediator has no power to impose a final binding decision on the parties.
Instead, the mediator’s role is to assist the parties work toward a mutually acceptable solution. This often is accomplished by helping the parties clearly define the issues associated with their dispute, with the goal to move toward realistic expectations and compromise.
Mediation is private and confidential, and the parties involved have complete control over the process and the outcome. Generally, mediations proceed more quickly than a FINRA arbitration proceeding or a proceeding in federal or state court. In addition, mediation typically costs less than FINRA arbitration or a proceeding in federal or state court. Statistics from FINRA show that 75% to 80% of mediations are successful.
FINRA recently fined former Texas-based Morgan Stanley and Ameriprise broker Steven Yellen $25,000 for unauthorized ...