Our Securities and Investments Professional Liability Practice Group services a broad client base, including, but not limited to:
- Registered representatives
- Financial planners
- Registered Investment Advisors
- Brokers/dealers
- Hedge fund and mutual funds and administrators
- Financial services outsourcing solution providers
- Private trust companies
- Insurance brokers/agents
We also handle:
- Fiduciary liability matters
- Corporate directors and officers
- Employment practice liability matters
In addition to professional liability matters in state and federal courts, we defend RIAs, brokers and broker-dealers before self-regulatory organizations, state agencies and the SEC. We handle securities arbitration claims before FINRA, AAA and other SROs.
Founded in 1962, Marshall Dennehey is one of the largest law firms in the country devoted exclusively to civil defense litigation. We have 500 attorneys in 19 offices strategically located in Philadelphia, Pittsburgh, Tampa, Orlando, Jacksonville, Ft. Lauderdale and communities throughout Pennsylvania, New Jersey, Delaware, Connecticut, Ohio, Florida and New York.
Clients realize a number of benefits from our extensive network of offices: travel time is sharply reduced and the attorneys working out of these offices and living in these respective areas are intimately familiar with the local practice and enjoy a good rapport with the judges before whom they frequently appear.
Recognizing the need for a cost-effective approach to the defense of professionals and organizations, we are dedicated to providing our clients with quality, timely and economical service. We are on the cutting-edge in developing innovative and alternative billing practices.
Results
Defense Verdict Secured in FINRA Arbitration Matter
We obtained a defense verdict in a FINRA arbitration where the claimant donated approximately $600,000 to a donor advised fund in 2012 and took a tax deduction. The claimant alleged that the donor advised fund was mismanaged and lost approximately $140,000 in value in 2022. We defended the fund’s managers in the case based upon the claimant’s lack of standing once the funds were donated. Further, we presented evidence through the respondent’s testimony that the account was managed in accordance with the goals and objectives set for the account. In addition, we presented evidence that the account was overall profitable and performed better than the S&P 500 index during the relevant time period.
Secured Defense Verdict In Richmond FINRA Arbitration
Defense award obtained on behalf of our client, a registered investment advisor, in a FINRA arbitration involving alleged mismanagement and lack of transparency concerning a Donor Advised Fund. The arbitration panel denied the claims in their entirety and recommended expungement of the claim from our client's registration records.
Thought Leadership
Case Law Alerts
FINRA Panel Orders Axos Clearing to Pay $49.2 Million to Former Worden Capital Clients
July 21, 2026
A FINRA arbitration panel ordered Axos Clearing to pay $49.2 million in compensatory damages, attorneys’ fees and costs to clients of the now defunct Worden Capital Management. In the amended statement of claim, claimants, a group of 102 individuals, asserted the following causes of action: fraud, churning, unauthorized trading, excessive trading/commissions, breach of fiduciary duty, unsuitability, breach of contract, negligence, and unjust enrichment. Claimants alleged that Axos failed to act while one of its introducing brokerage firms, Worden Capital Management, and its representatives used Claimants’ accounts as personal slush funds, engaging in alleged unsuitable and excessive trading and churning, garnering over $16 million dollars in commissions and fees while costing nearly all of the claimants out-of-pocket losses of over $12 million dollars. Axos denied the claimants’ allegations, asserted various affirmative defenses, and filed a third-party claim seeking a declaratory judgment that Worden Capital Management was responsible for the alleged damages. The FINRA arbitration panel found in favor of the claimants and awarded approximately $35.85 million in compensatory damages, $12.3 million in attorneys' fees, and roughly $72,000 in costs. Axos has challenged the ruling, filing a motion in federal court to vacate the arbitration award. The firm maintains that the arbitration process was flawed and that the award should be overturned. However, courts generally grant substantial deference to FINRA arbitration decisions, making successful challenges relatively uncommon.
Legal Updates for Securities and Investments
Congress Passes Financial Exploitation Prevention Act
July 16, 2026
On June 25, 2026, the House passed the Financial Exploitation Prevention Act of 2025 (“the Act”) by a vote of 414 to 2. The Act allows financial advisors and firms to delay suspicious transactions regarding the accounts of clients who are 65 or older, if they believe financial exploitation has occurred or is about to take place. With the advancement of technology and AI, the House’s overwhelming bipartisan passage of the Financial Exploitation Prevention Act represents an important step in strengthening the financial industry’s ability to combat the growing threat of elder financial exploitation. The Act recognizes what advisors have long known that financial professionals are often the first to detect suspicious behavior but have historically lacked clear legal authority to intervene before irreversible financial harm occurs. From the industry’s perspective, the bill accomplishes several important objectives, including the following: (1) Provides a practical “pause button” by allowing financial professionals to temporarily delay certain transaction requests when there is a reasonable belief that a senior or vulnerable adult is being financially exploited; (2) Empowers financial professionals to act by providing greater certainty that firms can act in good faith to protect clients without unnecessary legal risk; and (3) Strengthens investor protection without sacrificing client rights by allowing temporary delays based on a reasonable suspicion of exploitation, which is intended only to allow additional review and not to deny clients access to their money indefinitely. In sum, the Financial Exploitation Prevention Act will equip financial professionals with practical, carefully tailored tools to stop suspected financial exploitation before client assets are lost. By allowing firms to temporarily delay suspicious transactions under defined circumstances, Congress is recognizing the critical role advisors play as the first line of defense against increasingly sophisticated fraud schemes. The Act strikes an appropriate balance between protecting vulnerable investors and preserving individual financial autonomy, while reinforcing collaboration among advisors, families, and law enforcement to combat financial exploitation. The bill now awaits Senate action.
