March 06, 2019 Articles

Six Things to Know about Arbitrating Diminished Capacity Issues in FINRA Customer Cases

Unique situations arise when litigating competency issues in the FINRA forum

By Josh Jones

Litigation before the Financial Industry Regulatory Authority (FINRA) involving the elderly and other vulnerable clients is likely to increase significantly in the coming years given the aging of the investing population, that population’s unique vulnerabilities, and their substantial wealth. In addition to financial elder abuse claims, disputes are likely to involve competing claims to assets or claims that the firm wrongfully prevented a customer from making transactions or distributions. One thing is clear: Issues involving the competency of the elderly and vulnerable clients are certain to become more common in arbitration.

Senility and its effect on a person’s competency to direct his or her affairs raise complicated medical issues and unique concerns in litigation and arbitration. The following is a quick discussion of several of these concerns, along with a number of practical considerations for lawyers in this space.

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