Stanford Group Investment Losses and FINRA Arbitration

Investors who purchased Certificate of Deposit (CD) Investments from R. Allen Stanford’s Stanford Group Co. have struggled for nearly 3 years with the question of if, when and how much of their investment losses they may recover. Most investors are focused on recovering money from the receivership and hoping the SIPC will decide to insure investor losses. However, there is a third way to pursue some of the remaining losses investors may not recover through these other 2 avenues, FINRA Arbitration.

Just this week, according to foxbusiness.com, “…the court-appointed receiver for Stanford’s firm, asked a federal judge in Houston for permission to set up a claims process.” However, the article also stated, “It is unclear how much money will be distributed, when payouts will begin, and how such amounts will be calculated.”

The SIPC is also supposed to be deliberating on whether to cover damaged Stanford investors.  After initially stating that they would not cover Stanford victims, the SEC urged them to reconsider in June and in September the SIPC met to discuss the issue again. They have not said anything since their September meeting and it is unclear when, how much money or if damaged investors may receive compensation from the SIPC. The SIPC can cover insured investors up to $500,000.

It is still uncertain how much of their lost Stanford Group CD investments investors will receive from the receivership or the SIPC. The White Law Group may be able to help investors seek to recover the balance of their investment through a FINRA dispute resolution claim. Filing a FINRA arbitration claim and any award received does not preclude investors from receiving money from the receiver or SIPC, but may help to make up the difference between total investment losses and money received from the receivership and the SIPC.

Many of the brokers that worked at the Stanford Group Co. and sold the Certificate of Deposit (CD) investments that are at the center of the alleged ponzi scheme have moved on to other FINRA registered broker dealers. It has been reported that these brokers received relatively large commissions for the sale of the CD’s while they were at Stanford and may have some liability for investor losses.

Financial professionals and brokerage firms have a fiduciary duty to perform due diligence on any investment and to insure that an investment is appropriate in light of the investor’s age, investment experience, and investment objectives.

If you would like to speak to a securities attorney about your investment in a Stanford Group CD investment and your potential to recover some of your losses through FINRA arbitration please call our Chicago office at 312-238-9650.

The White Law Group, LLC is a national securities fraud, securities arbitration, investor protection, and securities regulation/compliance law firm with offices in Chicago, Illinois and Boca Raton, Florida.

For more information on The White Law Group, please visit our website at http://whitesecuritieslaw.com.