Sometimes things go wrong. When they do, it is good to know that a lawyer can help you with the procedures and process for suing your broker. When disputes and controversies arise you can arbitrate before you litigate. The NASD operates the worlds largest dispute resolution forum for the securities industry.
The NASD has specific programs for different types of investments. For example, for variable annuities, the NASD web page to provides detailed information for investors and brokers about the problems involved in the sale of variable annuities. And recently the NASD has published information about the problem with Equity Indexed Annuity funds.
To assist you in the resolution of a claim for monetary damages between investors and their brokers and securities firms, mediation provides an informal, voluntary, and non-binding approach in which an independent and trained neutral, a mediator, facilitates negotiations between disputing parties, helping them to find their own mutually acceptable resolution. You can be represented by a lawyer in this proceeding. The resulting settlements often save the parties substantial time and expense. Also, mediations can be initiated at any stage of the arbitration process.
The NASD itself has recognized the problem of over-zealous sale of many investments to people for whom they are not suitable. In these cases, the NASD has issues warnings to the brokerage firms to make certain that these unsuitable investments are not sold. Or that there is a determination that the investment is in fact suitable for a specific investor before selling it to that investor.
The NASD has also recently imposed stricter rules on brokers for selling variable annuities as well as branch managers and others responsible for supervising those salespersons.
The NASD has also published several "investor alerts" which warn investors about the risks in investing in variable annuities. The first paragraph of this investor alert is particularly telling: The marketing efforts used by some variable annuity sellers deserve scrutiny - especially when seniors are the targeted investors. Sales pitches for these products might attempt to scare or confuse investors. One scare tactic used with seniors is to claim that a variable annuity will protect them from lawsuits or seizures of their assets. Many such claims are not based on facts, but nevertheless help land a sale.