FINRA Sets Proposal to Temper Expungement in Motion
From the Desk of Jim Eccleston at Eccleston Law LLC:
FINRA voted to move ahead with new regulatory initiatives for broker-dealers. One of which would amend codes of arbitration with the goal of making it tougher for brokers to erase black marks from their public record.
The arbitration panel would instate several requirements such as receiving a copy of the BrokerCheck report when deciding expungement, as well as providing more detailed reports of the rationale for granting expungement in arbitration awards.
The new regulations from FINRA come after a series of developments that started to roll out in October 2013. It was during this year that expungement requests were granted in as many as 90% of cases resolved by settlement.
In an effort to reduce these numbers, the SEC signed off on a new rule that prevented firms from including an agreement where the claimant would not oppose expunging a part of the settlement.
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