2008 Securities Arbitration Filing Trends: Type of Controversy


FINRA released the final tallies for 2008 arbitration filings.  2008 witnessed marked change in trends regarding the type of controversy.  Filings citing “Omission of Facts” increased 337% from 2007 levels. Misrepresentation saw the second largest jump in filings with an increase of 171% over 2007.  In 2007, Misrepresentation was the 5th most frequently cited type of controversy and it jumped to second place in 2008.

On the other end of the spectrum, “Failure to Supervise” fell from the 4th most cited type of controversy in 2007 to 7th place in 2008. “Breach of Fiduciary Duty” has retained its #1 spot for another year as the most frequently cited type of controversy while “Margin Calls” was ranked 10th for the fourth year in a row. 

With the large number of Ponzi schemes discovered recently, will FINRA expand its list of controversy type options to include “Fraud”? Or will Ponzi claims be lumped into Negligence, Failure to Supervise and/or Omission of Facts?