A report from a FINRA task force recommends 51 changes to the arbitration process. Among these changes is increasing the stipend for arbitrators, explanation of arbitration decisions unless one party opts out, and revamping the expungement process for advisors. It also recommends adding a mediation process to a system. FINRA’s arbitration system has been viewed as biased for many years. Hugh Berkson, president of the Public Investors Arbitration Bar Association, finds the report balanced, although he believes the recommendations regarding expungement don’t go far enough. “Let’s at least start with this,” he said. One issue not addressed in the recommendations is the mandatory arbitration requirement.
A task force recommended changes to FINRA’s arbitration processes, including more transparency regarding decisions, increased compensation for arbitrators, and an overhaul of the expungement process. Hugh Berkson, president of the Public Arbitrators Bar Association found the report to be balanced but believes more changes must be made to the expungement process.
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.
