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What is a Statement of Claim? featured by top securities fraud attorneys, The White Law Group.

FINRA Statement of Claim Explained

If you are considering filing a FINRA arbitration claim against a brokerage firm or financial advisor, the first and most important document you will submit is the Statement of Claim.

A Statement of Claim is the formal written complaint that begins the FINRA arbitration process. It outlines the facts of the dispute, the legal violations alleged, and the damages the investor is seeking to recover.

Because FINRA arbitration is binding and procedurally structured, the Statement of Claim sets the foundation for the entire case.

What Is a Statement of Claim in FINRA Arbitration?

In FINRA arbitration, the Statement of Claim is the initiating pleading filed with FINRA Dispute Resolution Services. It is similar to a complaint filed in court litigation.

The document must:

  • Identify the parties involved

  • Describe the relevant facts

  • Explain the broker or firm’s alleged misconduct

  • State the legal causes of action

  • Specify the damages requested

Once filed, the brokerage firm or financial advisor (the “Respondent”) must submit an Answer responding to the allegations.

A properly drafted Statement of Claim defines the scope of the arbitration and shapes how the case will proceed.

Why the Statement of Claim Is So Important

The Statement of Claim is more than a summary of complaints. It:

  • Establishes the legal theory of the case

  • Identifies violations of securities laws and FINRA rules

  • Frames the damages calculation

  • Influences arbitrator perception from the outset

Because arbitrators rely heavily on written submissions, clarity and organization matter. A vague or poorly structured claim can limit arguments later in the arbitration process.

This is why many investors consult a FINRA arbitration attorney before filing.

What Should Be Included in a FINRA Statement of Claim?

A well-prepared Statement of Claim typically contains the following sections:

1. Introduction and Parties

This section identifies:

  • The investor (Claimant)

  • The brokerage firm

  • The financial advisor or registered representative

  • Relevant time periods

2. Statement of Facts

This is the factual narrative of what occurred. It often includes:

  • The investor’s background and investment objectives

  • Risk tolerance and financial profile

  • Representations made by the broker

  • Investment recommendations

  • Account activity

  • Losses sustained

The factual section should be chronological and supported by documentation.

3. Causes of Action

This section identifies the legal claims asserted. Common claims in FINRA arbitration include:

  • Unsuitable recommendations

  • Unauthorized trading

  • Selling away

  • Churning or excessive trading

  • Failure to supervise

  • Breach of fiduciary duty

  • Negligent misrepresentation

  • Violations of Regulation Best Interest

Each claim should connect specific facts to recognized legal standards.

You can learn more about these misconduct categories on our Types of Investment Fraud page.

4. Damages

The Statement of Claim must specify the relief requested. This may include:

  • Compensatory damages (investment losses)

  • Interest

  • Attorneys’ fees (where permitted)

  • Costs

  • Punitive damages (in appropriate cases)

A damages model should be clearly explained and supported by account records.

How to File a Statement of Claim With FINRA

To initiate arbitration:

  1. Draft the Statement of Claim

  2. Complete FINRA’s required forms

  3. Pay the applicable filing fee (based on the amount in dispute)

  4. Submit the claim electronically through FINRA

After filing, FINRA serves the claim on the Respondent, who must file an Answer within the required timeframe.

The arbitration panel is then selected, and the case proceeds through discovery and hearing.

For a broader overview, see our FINRA Arbitration Attorney page.

When Must a Statement of Claim Be Filed?

FINRA arbitration claims are subject to strict eligibility rules.

Under FINRA Rule 12206, claims are generally ineligible if filed more than six years after the occurrence or event giving rise to the dispute.

In addition, state statutes of limitation may apply depending on the specific legal claims asserted.

Determining when the time period begins can be complex, particularly in cases involving:

  • Non-traded REITs

  • Private placements

  • Structured notes

  • Long-term alternative investments

Delays in filing may bar recovery entirely.

Common Mistakes in a FINRA Statement of Claim

Some frequent errors include:

  • Failing to clearly connect facts to legal violations

  • Omitting key documents or account details

  • Asserting vague or unsupported damages

  • Missing applicable causes of action

  • Filing too close to time limit deadlines

Because arbitration awards are binding and difficult to overturn, careful preparation at the outset is critical.

What Happens After the Statement of Claim Is Filed?

Once filed:

  • The Respondent submits an Answer

  • Arbitrators are selected

  • A preliminary conference is scheduled

  • Discovery begins

  • The matter may proceed to mediation or hearing

Many cases settle before a final hearing, but the strength of the initial Statement of Claim often influences settlement discussions.

Do You Need an Attorney to File a Statement of Claim?

Investors are not legally required to hire an attorney to file a FINRA arbitration claim. However, brokerage firms are typically represented by experienced defense counsel.

Because the Statement of Claim frames the entire dispute, professional drafting can significantly affect the outcome of the case.

An experienced securities fraud attorney can:

  • Identify viable causes of action

  • Analyze account statements and trading history

  • Develop a damages model

  • Navigate FINRA procedural rules

Speak With a FINRA Arbitration Attorney

If you believe your financial advisor or brokerage firm engaged in misconduct and you have suffered investment losses, you may have the right to pursue recovery through FINRA arbitration.

The White Law Group represents investors nationwide in FINRA arbitration matters and offers free consultations. Our firm works on a contingency fee basis in most investor cases.

To discuss your potential claim and whether filing a Statement of Claim is appropriate, contact our office today.

FAQ: Statement of Claim Explained

Q1: What is included in a FINRA Statement of Claim?
A FINRA Statement of Claim outlines your dispute with a brokerage firm or broker. It includes the parties involved, the alleged misconduct (such as fraud, negligence, or unsuitable investments), the damages you are seeking, and any supporting evidence. A well-prepared statement is critical for a successful arbitration.

Q2: How long does it take to draft a FINRA Statement of Claim?
The time varies depending on the complexity of your case and the amount of documentation. Most claims take several weeks to prepare, including reviewing account statements, correspondence, and investment records, and coordinating with an attorney experienced in FINRA arbitration.

Q3: Can a FINRA Statement of Claim be amended after filing?
Yes. You can amend your Statement of Claim if new evidence emerges or if you need to clarify your allegations. An experienced FINRA arbitration attorney can guide you on how and when amendments are allowed under FINRA rules.

Q4: What happens after filing a Statement of Claim?
After filing, FINRA reviews the claim for eligibility and sends it to the respondent (broker or firm). The parties then select an arbitration panel, attend preliminary hearings, exchange documents, and prepare for the arbitration hearing, where evidence and arguments are presented before the panel.

Q5: Do I need an attorney to file a FINRA Statement of Claim?
While you can technically file on your own, having an experienced FINRA arbitration attorney is strongly recommended. An attorney ensures your claim is properly drafted, deadlines are met, and your rights are protected throughout the arbitration process.

Q6: How does a Statement of Claim affect the timeline of my FINRA arbitration?
The Statement of Claim starts the arbitration clock. Once filed, FINRA schedules the case and determines deadlines for responses, discovery, and hearings. Filing promptly can prevent delays and preserve your ability to recover losses.

Last modified: February 25, 2026

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