Can You Recover Losses From a Margin Liquidation?

You can recover losses from a margin liquidation. A broker misconduct attorney can review your case, explain your legal options, and, if warranted, represent and advocate for you as you try to recoup your losses from a margin liquidation. 

Speak with a broker misconduct lawyer right away if you want to recover losses due to a margin liquidation. Your lawyer will let you know if you have grounds for taking legal action against your broker.

If so, your attorney will build your case against your broker to prove that they should have to compensate you for your losses. 

When Can You Recover Losses From a Margin Liquidation?

Meet with a nationwide securities lawyer to find out if you can recover some or all of your losses from a margin liquidation. Your attorney will provide information about times when your broker can be held liable for your losses, such as if they:

• Recommend a margin account or margin trades that are unsuitable based on the specifics of your financial situation
• Do not inform you about the risks of margin trading
• Liquidate your securities for a margin call, but sell them at an unreasonably low price

Be open and honest with your securities attorney about your losses from a margin liquidation. Your lawyer will commit substantial time and resources to your case and explore every legal avenue to help you get money back from the liable broker.

Unfortunately, if a broker was not involved in your margin liquidation, it is unlikely that a securities lawyer will be able to help you. 

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How Can You Recover Losses From a Margin Liquidation?

The Financial Industry Regulatory Authority (FINRA) offers arbitration to help you recover losses in the aftermath of a margin liquidation.

Arbitration may seem overwhelming, but you do not have to go through this process alone. Securities lawyers will guide you through each stage of arbitration.

Below are details about the stages of FINRA’s arbitration process.

1. File Your Claim 

Start FINRA arbitration by submitting a claim that outlines your dispute, the parties involved, and the losses you face due to a margin liquidation.

Next, FINRA will notify your broker about your claim via a Claim Notification Letter. Your broker has 45 days to respond. When they do, they can share information about the defense they will argue and exhibits that support their position.

2. Select From a List of Arbitrators

FINRA will provide a list of arbitrators to your lawyer and your broker’s lawyer. Together, the lawyers will research and rank the arbitrators pursuant to the FINRA arbitrator ranking process and then FINRA will appoint the arbitrators for your case.

From here, a prehearing conference will be held to discuss procedural issues and other arbitration topics. 

3. Begin Discovery 

In the discovery stage, you and your broker exchange documents and prepare the case for the final hearing.. The stage is a great opportunity to gather a wide range of evidence to strengthen your argument and prove that a broker is responsible for your losses from your margin liquidation. 

After these stages, arbitration gets underway, and your case goes in front of one to three arbitrators. In terms of whether legal representation is required for securities arbitration, the answer is no.

However,  it pays to have an extremely experienced securities arbitration lawyer on your side. With help from an experienced securities arbitration attorney, you can boost your chances of getting your desired outcome in arbitration. 

How Does a Securities Lawyer Help You Recover Losses From a Margin Liquidation?

Securities lawyers are meticulous when it comes to helping their clients recover losses from margin liquidations. Your attorney will examine your margin liquidation in depth, including communications between you and your broker, account statements, and your brokerage agreement. They will do so in the hopes of identifying any signs of broker misconduct. 

If your case goes to arbitration, your lawyer remains on your side every step of the way. They will help you prepare for FINRA arbitration and make sure you understand all that this process entails.

If you have arbitration concerns or questions at any time, your attorney will address them promptly. 

Along with these things, your lawyer will handle your settlement negotiations. If you are offered a settlement for your losses from a margin liquidation, you and your attorney can assess the proposal. Your lawyer can provide insights into the short- and long-term implications of any decision you make regarding a settlement offer.

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The Bottom Line on Whether You Can Recover Losses From a Margin Liquidation

It is possible to recover losses relating to a margin liquidation, but you may need help from securities attorneys. With guidance and support from a lawyer familiar with securities law, you are well-equipped to prove that a broker is responsible for your margin liquidation losses.

The team at Meyer Wilson Werning has over 75 years of combined experience. Our industry-renowned trial attorneys will tackle the challenges you will face as you search for ways to recover losses from your margin liquidation.

Let us help you with your securities case. Contact us today to get started. 

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