Citywire RIA (July 26, 2023) - Some investors and their legal advocates say that mandatory arbitration can present a prohibitive barrier to RIA clients' ability to pursue claims against firms.
Nearly two-thirds of registered advisors use mandatory arbitration clauses, the Securites and Exchange Commission (SEC) found in a congressionally mandated report.
The June 27 report did not include advisory clients’ perspectives on arbitration. But in a Tuesday afternoon forum, a couple of those clients got a chance to speak up.
‘It makes you wonder how many investors can afford to pay thousands of dollars out of pocket, right after getting hit with huge, life-changing losses? Where is the justice?’ said Marykay Dragovich during the forum, which was hosted by the Public Investors Advocate Bar Association (PIABA), a group of lawyers who represent claimants in...