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Home > Practice Areas > Securities Mediation

Securities Mediation

Why Mediation May Be Beneficial

Mediation is one of several legal options available to investors who believe they have been defrauded by their brokerage firm or investment advisor.

As a general rule, a 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 that a mediator has no power to impose a final binding decision on the parties.

Instead, the mediator's role simply is to help 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 a 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 a FINRA arbitration proceeding or a proceeding in federal or state court. Statistics from FINRA show that 75% to 80% of mediations are successful.

The Mediation Process

The mediation process normally begins with the selection of an independent and impartial mediator who is experienced and knowledgeable with securities disputes. The mediator must be acceptable to all of the parties involved in the securities dispute.

A mediation generally then begins with an opening session in which counsel for each party explains the important facts and circumstances associated with their respective positions in the securities dispute.

After the opening session is complete, the parties usually break for private discussions, or caucuses, with the mediator. During the caucuses, the mediator will ask questions and gather information from each party in an effort to understand the critical issues involved in the dispute, as well as to assist the parties in moving toward a mutually acceptable resolution of their securities dispute.

Mediation is a voluntary process. If, at the end of the mediation process, either party is not satisfied with the proposed resolution suggested by the mediator, there is no obligation to settle the dispute and the parties will be able to continue with their FINRA arbitration proceeding or their proceeding in federal or state court.

Our Mediation Experience

When it comes to recovering investor losses, we believe experience matters. Over the years, the attorneys at Maddox Hargett & Caruso, P.C., have represented thousands of investors, assisting and advising them throughout the securities dispute resolution process. This includes a FINRA arbitration proceeding, a proceeding in state or federal court, and, when appropriate, mediation.


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