Broker-Customer Disputes At A Glance

Capabilities and Services

NERA economists work on behalf of counsel for both brokers and customers in disputes concerning investment activities. With training and experience from areas such as trading, risk management, academia, and consulting, NERA economists use quantitative and statistical tools to provide objective analyses to address the questions that arise in these disputes.

Disputes between brokers and customers often center on the suitability of trades recommended by brokers or of decisions made by investment advisors. In many cases, the dispute relates to the question of whether the broker's actions resulted in an overly concentrated portfolio. Other disputes involve issues such as inappropriate securities given an investor's investment objectives, churning, excessive markups, or excessive use of leverage. Often, a series of complaints by customers is based on similar allegations against a group of brokers. Examples of this include claims that brokers pushed stocks recommended in bad faith by analysts at their firms or claims that brokers improperly encouraged customers to use margin to exercise options.