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Posts Tagged ‘NARs’

Latest FINRA Rules to Regulate Expungement Actions

Posted on: February 19th, 2019

By: Margot Parker

FINRA recently announced its approval of enhanced training and guidance for arbitrators hearing expungement requests, an issue under increasing scrutiny as over 90% of such actions are currently granted. The proposal is now under review by the SEC and represents a step toward making it more difficult for brokers to have customer complaints expunged from their public records. The proposed rules also include a ban on compensated non-attorney representatives (NARs) from representing clients in FINRA arbitrations, as part of another step to strengthen the arbitration process.

While a ban on NARs has been widely supported, critics of the expungement process believe more should be done to take the burden away from customers to fight expungement actions. FINRA states that it shares these concerns. To reduce the high volume of expungements in the past, it codified a rule stating: “expungement is an extraordinary remedy that should be recommended only under appropriate circumstances.” With these recent steps, we may continue to see changes in the regulation of FINRA expungement actions in the near future.

If you have any questions or would like more information, please contact Margot Parker at (310) 937-2066 or [email protected].