If you suspect your broker is mismanaging your account, you can take several steps.

- An investor can make an informal complaint with the broker’s firm. This option has two disadvantages:

- If you are seeking to recover lost funds, chances are slim that you will recover them with an informal complaint. Brokerage firms know that arbitration is typically the route taken when investors are attempting to recover funds.

- If you end up arbitrating or filing suit in the future, you may be wasting valuable time making an informal complaint. Court or arbitration initiatives may have a statute of limitations, after which you will not be able to act.

- An investor can file a formal complaint against the broker. Contact the Securities and Exchange Commission (http://www.sec.gov) and your state’s securities and insurance regulators. This process will begin an investigation of the broker in question. Depending upon the findings of the investigation, the broker may be suspended, or the broker’s firm may be suspended from selling securities.

The advantage to filing a formal claim is documentation of your initial complaint. If you never filed a formal complaint but you later pursue arbitration, the broker or brokerage may be able to claim your silence condoned the actions of the broker.

- An investor can file a complaint in arbitration or file a lawsuit. Arbitration is more common. Although you may win the arbitration, the amount awarded may be a small portion of any money you lost as a result of broker mismanagement. This article at http://seniorjournal.com/ discusses the results of broker mismanagement arbitration and lists circumstances that might alert an investor to possible mismanagement of his or her funds.