FINRA’s role in helping investors.
It’s great to have an online brokerage account. But what happens if you need to reach a live person to help you with a problem? And let’s say it’s a day like this past Thursday, with lots of action in the stock market. As reported by Lu Wang of Bloomberg, sell orders briefly hit the highest level since a “liquidity-driven selloff in May 2010.”
You call your brokerage firm and are put on hold. That can be frustrating, but perhaps understandable.
What about a different type of frustration? A reader from Connecticut emailed me about the conversion of a traditional IRA to a Roth. A traditional IRA is taxdeferred. A Roth IRA is tax-free. But to move from one to the other, income taxes will be triggered in most situations.
The reader, whom I’ll call Tim, wrote:
“In May 2017, I converted substantial securities, and (the institution) issued erroneous 5498 and 1099-R tax statements. They followed with erroneous financial statements. After six months of arguments back and forth, (the institution) finally issued corrected 5498 and 1099-R tax statements in April 2018 (the correcting may have been motivated by my seeking help from FINRA, who called the (institution’s) operational person I had been arguing with).”
Problem solved — however, only after a long and arduous process, and only after regulators came to the rescue. FINRA (the Financial Industry Regulatory Authority) regulates the brokerage industry.
But, then a new problem arose.
“After filing for a tax extension, I requested and (the institution) declines, even refuses to correct/issue new corresponding financial statements, which would back up my tax records.”
Tim asked: “What alternatives/recourse do I have to (get) corrected financial statements?”
While Tim did not provide me with the details of the inaccuracies, customers of brokerage firms can and should expect accurate statements. That’s basic.
With that sort of problem to solve, I would advise reaching out to legal and compliance officers at the brokerage firm. If that doesn’t work (it should), you go as far as filing a complaint with FINRA’s Investor Complaint Center.
But, before considering a written complaint, be sure to read “Investor Complaint Program: What to Do When Problems Arise,” which you can download at finra.org/ file/investor-complaintcenter-brochure. (If you send me an email, I will forward it to you.)
Also read finra.org/investors/investor-complaintcenter, where you will find out about the types of problems handled by FINRA versus other regulators.
You can also reach out to FINRA for assistance. I spoke with FINRA spokesperson, Angelita Williams, to review the best way to do that.
Anyone of any age can call FINRA’s Securities Helpline for Seniors at 844574-3577 (Monday to Friday, 9 a.m-5 p.m. ET) for help. Williams noted that: “FINRA call center staff are specially trained to answer questions ranging from the simple to the more complex to help investors make informed decisions.”
Again, there are no age limits. And there is only one mandate: to help people solve problems.
A second option is the FINRA Investor Complaint Center (240-386-4357). There you can get immediate assistance and for guidance regarding the complaint process, according to Williams.
Luckily, frustrations and problems are not everyday occurrences. When they happen, it’s good to know there are resources that can help.
We’ll talk about this topic in future columns, as well as what to do if you cannot get resolution of a problem. If you have a story that you’d like to share with readers of this column, write to me at readers@juliejason.com. Please include your city and state.