Giving your Taiwan trading password to a helpful staff member can decide the case before it starts. In September 2023, Taiwan's High Court refused to hold a brokerage liable for losses a client ran up after handing an e-trading certificate and password to a wealth manager the client had known for years. The firm's account agreement and statements had repeatedly told clients not to do that, and the court treated the arrangement as a private mandate outside the brokerage contract (Taiwan High Court, 111 Jin-Shang No. 3). That is a second-instance judgment; the Judicial Yuan database shows no later decision in the case.
Even a Financial Supervisory Commission sanction against that staff member did not carry the claim. The client had handed over the password.
When the firm does pay
An earlier ruling went the other way. A broker persuaded a client that shares in the brokerage's parent company could be bought below market price, provided the money went to the broker's personal account. Over about six months the client made 11 transfers totaling NT$4,245,640. The broker later sold the client's shares from the branch computer system without consent. Criminal convictions followed: fraud and breach of trust, one year and ten months for each.
In April 2023 the High Court held the brokerage jointly liable under Civil Code Article 188. The acts happened during business hours, at the branch, and used services the firm itself offered, so they were objectively connected to the job. The firm could not prove it had supervised the employee properly. The client still took a 30% reduction on the fraud portion, because wiring settlement money to an employee's personal account broke the account agreement (Article 217). After the broker's partial repayment, the firm was held jointly liable with the broker for NT$2,596,202, 70% of the remaining loss. The shares sold without consent had to be returned against repayment of NT$4,467,600, plus NT$726,330 in cash dividends (judgment). The Supreme Court rejected the firm's appeal in May 2024 (ruling).
Brokerage staff may not accept discretionary orders, hold a client's seal or passbook, trade in a client's name, or execute trades on terms the client did not give (Regulations Governing Responsible Persons and Associated Persons of Securities Firms, Article 18, paragraph 2).
Two routes outside court
The Securities and Futures Investors Protection Center (SFIPC) mediates civil disputes between investors and securities firms arising from securities trading (Securities Investor and Futures Trader Protection Act, Article 22). You do not need to complain to the firm first: neither the grounds for refusing an application in Article 23(1) nor the grounds for returning one in Mediation Rules Article 12 include skipping a complaint. If a lawsuit is already pending, you can still apply until oral argument closes at first instance (Article 23(1)(iv)).
Small claims move faster. For NT$1 million or less, the center fixes a session date straight away (Mediation Rules, Article 13-1), and if the firm stays away without good reason, the mediators may issue a proposal (Article 25-1). Unless someone objects in writing within 10 days of service, the proposal stands (Article 25-2). A court-approved mediation has the effect of a final civil judgment (Article 26). The fee is NT$1,000 per case, refunded if the firm refuses or mediation fails (SFIPC FAQ). Filing also stops the two-year tort clock under Civil Code Article 197, which runs from when you learn of the damage and who is liable, but only if the mediation is not withdrawn, rejected or unsuccessful (Article 24).
The ombudsman route starts at the firm. A complaint goes there first, and the firm has 30 days to respond. Within 60 days after that, you can apply to the Financial Ombudsman Institution (Financial Consumer Protection Act, Article 13). A firm that agreed in advance to the procedure must accept decisions up to a set amount (Article 29). Under the FSC's March 18, 2022 notice, the cap is NT$1.2 million for the products the notice names, such as trusts, derivatives and discretionary investment, and NT$120,000 for everything else, which covers ordinary brokerage of listed shares (FSC notice).
Where one cause harms many investors, the SFIPC can sue in its own name on authority from 20 or more of them (Article 28); claims over issuers' false financial reports are covered in False Financial Reports in Taiwan: Who May Claim Civil Damages.
Your registration status
An ARC holder living in Taiwan counts as a domestic foreign investor and may invest without the product limits that bind offshore investors, after registering with the Taiwan Stock Exchange to open an account (Regulations Governing Investment in Securities by Overseas Compatriots and Foreign Nationals, Articles 3, 4(4), 10 and 19). Investing from the United States makes you an offshore investor: you need a local agent and custodian, and margin trading is barred unless the FSC provides otherwise (Articles 16, 17 and 21). Nationality is not a condition for any of the procedures above.
If you are back in the United States, the paperwork can travel: monthly statements, wire confirmations and saved chats with the broker are what a Taiwan lawyer will ask to see first. The lawyer can draft the complaint and the mediation or ombudsman application, attend the session for you, and handle a criminal complaint or civil suit. Hovering International Law Firm (昊鼎國際法律事務所) offers consultations with an English-speaking lawyer in Taipei at wei@hoveringlaw.com.tw. The Taipei office is at 7F-2, No. 35, Sec. 1, Chengde Rd., Datong Dist., Taipei City 103 (103 臺北市大同區承德路一段35號7樓之2); the Taichung office is at 6F-1, No. 19, Guanqian Rd., North Dist., Taichung City 40453 (40453 臺中市北區館前路19號6樓之1).
Official sources
Checked October 22, 2026.
- Securities Investor and Futures Trader Protection Act (證券投資人及期貨交易人保護法), Articles 4, 22, 23, 24, 25-1, 25-2, 26 and 28.
- SFIPC, Mediation overview (small claims up to NT$1 million) and mediation FAQ (Chinese).
- Financial Consumer Protection Act (金融消費者保護法), Articles 4, 13 and 29.
- Financial Supervisory Commission, notice of March 18, 2022 (金管法字第11101915421號) on the amounts under Article 29(2).
- Regulations Governing Responsible Persons and Associated Persons of Securities Firms (證券商負責人與業務人員管理規則), Article 18.
- Regulations Governing Investment in Securities by Overseas Compatriots and Foreign Nationals (華僑及外國人投資證券管理辦法), Articles 3, 4, 10, 16, 17, 19 and 21.
- Regulations Governing the Organization and Mediation Procedures of Securities Investor and Futures Trader Protection Institution Mediation Committees (證券投資人及期貨交易人保護機構調處委員會組織及調處辦法) ("Mediation Rules"), Articles 12, 13, 13-1 and 13-2.
- Civil Code (民法), Articles 188, 197 and 217.
- Judicial Yuan judgments: Taiwan High Court 111 Jin-Shang No. 3 (September 12, 2023, second instance); Taiwan High Court 111 Zhong-Shang No. 962 (April 11, 2023); Supreme Court 112 Tai-Shang No. 1631 (May 22, 2024, firm's appeal rejected).
Frequently Asked Questions
- I live in Taiwan on an ARC and trade through a Taiwanese broker. Can I use the same dispute procedures as Taiwanese investors?
- Yes. Neither the investor-protection mediation route (Securities Investor and Futures Trader Protection Act, Article 4 and Article 23) nor the ombudsman route (Financial Consumer Protection Act, Article 4) has a nationality requirement. Clients classified as professional investors fall outside the Financial Consumer Protection Act. The SFIPC sends written notices by registered mail, so the application needs an address where you can receive documents promptly.
- What happens if the brokerage ignores an SFIPC mediation?
- In an ordinary case, a firm that does not agree to mediate within the time set is treated as refusing, and the process ends (Mediation Rules, Article 13). For small claims of NT$1 million or less, the SFIPC sets a session directly; if the firm fails to appear without good reason, the mediators may issue a proposal (Article 25-1). If no party objects in writing within 10 days of service, the mediation is deemed concluded on those terms (Article 25-2; Mediation Rules, Article 13-2). Once approved by the court, it has the same effect as a final civil judgment.
- I gave my login to a staff member who managed the account for me. Can I recover my losses from the firm?
- It depends on the facts. In a 2023 High Court case, a client who handed e-trading credentials to a wealth manager for private management lost the claim against the firm, which had warned in the account documents not to share passwords. In another 2023 High Court case, now final, the firm was held jointly liable where its employee sold the client's shares through the branch system without consent. Taking discretionary orders or holding a client's seal or passbook is prohibited for brokerage staff in any event.
This article provides general information and is not legal advice on any individual matter.
