Arbitration Hearing
Arbitration, Brokers, Corp Finance, Enforcement, Investors

What Does a Securities Lawyer Do?

While securities law is itself a specialized field of law, there is also more than one type of securities lawyer. There are transactional securities lawyers, who help companies raise capital, obtain and maintain listings on a stock exchanges, assist in mergers and acquisitions and perform the varied reporting requirements for public companies.

There are also securities litigation lawyers who help investors, financial professionals, and financial firms respond to SEC, FINRA and State Regulators in their investigations and examinations. Securities lawyers also defend their clients in federal, state and administrative securities enforcement proceedings. Those securities lawyers also represent all market participants resolve their disputes in securities arbitration and court proceedings.

How a Securities Lawyer Can Benefit You

Securities Arbitration and Litigation

A securities lawyer can represent you in any litigation arising from your investments, including a shareholder’s derivative action, a class action suit, or a suit against your broker, or in the case of a financial professional, defending you from such claims.

Almost all disputes between brokers and customers are required to be resolved in arbitration. Securities arbitrations are not run-of-the-mill proceedings, they are full-blown hearings, very similar to courtroom trials. Securities arbitrations need to be treated seriously, as arbitrators have the same power and authority as a judge in a courtroom.

Whether you are an investor or a financial professional, you need an experienced securities lawyer to represent you in securities arbitration. Your lawyer needs to know the FINRA arbitration procedures, the rules governing the disclosures or trading surrounding your investments, and the securities laws in general. This is not the place for new lawyer, or for one who does not practice securities law.

Mark Astarita‘s Overview of Securities Arbitration Process has been downloaded tens of thousands of times. The article includes detailed information regarding the filing of a complaint and answer, selection of arbitrators, discovery dos and don’ts, and is a walkthrough of the entire process. 

His article What Happens at a FINRA Arbitration Hearing provides a deeper dive into the actual arbitration hearings themselves. Both should be required reading or anyone involved in a securities arbitration.

Securities Lawyer for SEC Investigations

SEC Investigations are intimidating, and the securities laws are complex. An experienced securities lawyer can work with a target of the investigation to mitigate the potential for the investigation to turn into an enforcement proceeding, and to resolve the SEC’s concerns raised in the investigation.

For a witness, an experienced securities lawyer can negotiate the document production required by the subpoena and reduce the time required to respond to the subpoena. The lawyer will also interact with the SEC Staff to help prevent witness from becoming more involved in the investigation.

For a more detailed view of how a securities lawyer can assist in the response to a subpoena, read Mark Astarita’s article When the SEC Comes Calling.

Transactional Securities Lawyers

Securities lawyers also frequently represent corporate clients in the transactional work involved with initial public offerings, private sales of securities, issuance of stock or other securities, and mergers and acquisitions. In this capacity, they also assist companies in complying with securities laws and regulations which ultimately serves to benefit consumers. 

Transactional securities lawyers help companies comply with the issues inherent in securities transactions, including private placements, public offerings, and mergers and acquisitions. In addition, public and private companies have ongoing disclosure and reporting obligations.

These attorneys also work with their clients to prepare and implement their initial public offerings (IPOs), direct public offerings (DPOs), SPACs, and debt or hybrid securities secondary offerings. These attorneys provide legal services to corporations in the areas of corporate and business planning and structuring, including the preparation of registration statements and prospectuses, assistance in negotiating underwriting and placement arrangements, and the preparation of filing on NYSE and NASDAQ and other stock exchanges, and related transactional aspects of the offerings.

Securities Lawyer for Due Diligence

A securities lawyer can play a critical role in protecting your investments. Initially, as you are planning your investments, a securities lawyer can assist in reviewing the public information that is available regarding the company that you are looking to invest in, reviewing and explaining the disclosure documents provided by the company, research the background of the individuals who are in management, research lawsuits and claims made against management and the company, and provide additional due diligence regarding the investment, including the financial history and health of companies based on their reporting disclosures.

After the Investment

A securities lawyer can advise you when you have a question as to how your account is being handled, or on issues of suspected securities fraud, mismanagement of your investments and incorrect executions, pricing and margin calls. 

Market losses are inevitable, and most losses are caused by forces outside of the control of management and your broker. However, losses are sometimes caused by the conduct of others. Those damages can be recovered in arbitration.

A securities lawyer can advise you as to the ability to recover your losses for other types of forces, including:

  • Breach of fiduciary duty
  • Negligence
  • Failure to Supervise 
  • Misrepresentation or Omission of Facts
  • Fraud
  • Breach of Contract
  • Churning
  • Failure to diversify
  • Market manipulation
  • Violation of Blue Sky Laws
  • Elder Abuse
  • Errors and Erroneous Charges
  • Execution Errors
  • Unsuitable Investments
  • Unauthorized Trading
  • Trading without permission
  • Unsuitability
  • Litigation and Arbitration

Each of these types of claims is discussed in full in Typical Customer Claims in Arbitration.

Questions? Talk to a Securities Lawyer

The securities lawyers at Sallah Astarita & Cox, LLC have 100 years of combined experience as SEC Staff attorneys and brokerage firm attorneys. If you have a question about securities law, or whether a securities lawyer can help you, call them at 212-509-6544.

The Securities Lawyer