These Are the Most Common Issues in FINRA Arbitration

The Financial Industry Regulatory Authority (FINRA) recently published a report highlighting the most common issues raised in investor arbitration proceedings in 2025. Overall, more than 2,500 investors filed for FINRA arbitration last year, and FINRA’s data show that many of these investors filed claims involving multiple issues. If you believe that you may have suffered investment losses due to any of these issues, you may be eligible to file for arbitration, and we recommend speaking with an experienced FINRA lawyer promptly.

The Top 15 Issues in FINRA Arbitration

When can you file for FINRA arbitration? According to FINRA, these are the 15 most common issues raised in investor arbitration proceedings:  

1. Breach of Fiduciary Duty

All stock brokers owe a fiduciary duty to their clients. This means they must put their clients’ interests first and not let conflicts of interest affect their investment recommendations. According to FINRA, approximately 45 percent of all arbitration complaints filed in 2025 involved claims for breach of fiduciary duty.

2. Negligence

While stock brokers’ recommendations don’t need to be profitable 100 percent of the time, stock brokers do need to ensure that their recommendations are based on sound and reasoned decision-making. Negligence is among the most common issues raised in FINRA arbitration cases as well, including approximately 43 percent of all cases filed in 2025.

3. Failure to Supervise

Broker-dealer firms are required to supervise their brokers under FINRA’s Rules and under federal law. Failure to supervise can lead to a host of issues—from breaches of fiduciary duty to negligence, and from unauthorized trading to breach of contract.

4. Misrepresentation

When making investment recommendations, stock brokers have a duty to provide investors with the information they need to make informed decisions. This necessarily involves providing accurate information that investors can use to assess the risks involved in investing. If a stockbroker misrepresents material information—whether inadvertently or intentionally—this can provide clear grounds for investors to seek to recover their investment losses.

5. Breach of Contract

Breach of contract claims filed in FINRA arbitration can involve a wide range of issues—from charging excessive fees to failing to transfer investors’ funds upon request. According to FINRA, more than a third of all arbitration cases filed in 2025 involved breach-of-contract claims. Many of these cases likely involved claims for breach of fiduciary duty and other issues.

6. Omission of Facts

Along with their duty to avoid misrepresenting material information, stockbrokers also have a duty to avoid omitting material information in their disclosures to clients. This includes information on fees, risks, and anything else that might be material to an investor’s decision to invest.

7. Suitability

When making investment recommendations, stock brokers must make recommendations that are “suitable” to each investor’s individual circumstances. This means that their recommendations must reflect each individual investor’s portfolio value and composition, risk profile, age, and other relevant factors. Suitability is another common issue in FINRA arbitration cases—it was among the claims asserted in just under a third of all FINRA arbitration complaints filed last year.

8. Fraud

“Fraud” is a broad term that encompasses many of the other issues on this list. Misrepresenting or omitting material information, and engaging in manipulative or unauthorized trades are common examples of investment fraud—among many others.

9. Breach of Regulation Best Interests (Regulation BI)

As its name suggests, Regulation Best Interests (Regulation BI) requires stock brokers to put their clients’ interests first. If a stockbroker does not act in an investor’s best interests, this can constitute a clear violation of Regulation BI. Similar to fraud claims, Regulation BI claims will frequently involve other issues included on this list as well.

10. Manipulation

Manipulative trading, or manipulation, involves front-running and other practices designed to improperly influence securities markets for the benefit of stockbrokers and their firms. Manipulation of securities markets can violate various state and federal laws (in addition to FINRA’s Rules), and it can also provide clear grounds for investors to seek to recover their losses.

11. Violation of Blue Sky Laws

State securities laws are commonly referred to as “blue sky” laws. Along with claims under federal securities laws like the Securities Act of 1933 and the Securities Exchange Act of 1934, investors can (and do) pursue claims under state law in FINRA arbitration as well.

12. Elder Abuse

Elder abuse involves taking advantage of access to aging investors’ portfolios and accounts. It can involve any of the other issues on this list (among others), and, according to FINRA, nearly 10 percent of all arbitration complaints filed in 2025 involved claims related to the victimization of elderly investors.

13. Unauthorized Trading

Stock brokers must obtain their clients’ authorization before executing trades. Buying, selling, shorting, and other transactions executed without a client’s authorization can provide clear grounds to pursue claims in FINRA arbitration if they lead to investment losses.

14. Errors Related to Charges

Errors related to charges can also provide clear grounds to pursue claims in FINRA arbitration. Here too, this includes both inadvertent and intentional errors—and intentional errors are far more common than they should be.

15. Failure to Transfer

According to FINRA, the fifteenth most common issue raised in arbitration cases in 2025 was failure to transfer investors’ funds upon request. If a broker-dealer fails to timely transfer an investor’s funds (or refuses to transfer an investor’s funds at all), this can also lead to losses that investors can—and should—seek to recover through FINRA arbitration.

While these are the most common grounds for pursuing claims against broker-dealers in FINRA arbitration, they are not the only grounds to file a claim as an investor. If you believe that you may be a victim of any form of investment fraud, it will be worth talking to an experienced FINRA lawyer to find out if you have a claim.

Request a Free Consultation with a FINRA Lawyer at Zamansky LLC

Do you need to know more about filing for FINRA arbitration? If so, we invite you to get in touch. Call 212-742-1414 or contact us online to request a free consultation with an experienced FINRA lawyer at Zamansky LLC.