FINRA’s dispute resolution process is subject to possible reform. Fifty-one reform recommendations were presented by the regulator’s arbitration task force. A significant focus is on the expungement process, including the development of a special panel of arbitrators to address these cases. Other key recommendations include the addition of a mediation process, increased arbitrator honorarium, and publicizing the content of the arbitration cases. Hugh Berkson, president of the Public Investors Arbitration Bar Association, is “hopeful” about the recommendations but states that their effectiveness “remains to be seen.” He noted that the increased remuneration for arbitrators could either increase the quality of the arbitrators or encourage some to grant low settlements to clients.
FINRA’s dispute resolution overhaul could increase transparency in the arbitration process, address expungement case concerns, and add a mediation component to the system, thus addressing many advisor and client concerns. “I’m hopeful,” says Hugh Berkson, president of the Public Investors Arbitration Bar Association.
Hugh Berkson is a Securities Attorney with McCarthy, Lebit, Crystal & Liffman, Co. LPA. Hugh is rated AV® Preeminent™ by Martindale-Hubbell®.
He obtained a business degree in Finance from the University of Texas at Austin in 1989, and is a 1994 graduate of Case Western Reserve University School of Law, where he was a member of the Order of the Barristers and received both the American Jurisprudence Award, (National Mock Trial) in 1993 and the Jonathan M. Ault Mock Trial Prize for 1993-1994.