Although FINFA received 51 recommendations from a task force designed to improve the arbitration process, it recently announced only a few modest changes to the system. The number of public arbitrators is expanded from 10 to 15 and attorneys can chair arbitrations after participating in one. Also, it will be easier to dismiss arbitration cases that had previously been settled. FINRA explains that these are the first small steps in a larger process. While pleased that change is occurring, Hugh Berkson, president of PIABA is dissatisfied that the system is still viewed as opaque and unfair to investors. “These [changes] don’t begin to touch the underlying transparency issues.” FINRA promises more changes are coming but will they truly fix the underlying problems?
Hugh Berkson is a Securities Attorney with McCarthy, Lebit, Crystal & Liffman, Co. LPA with over 20 years of representing individuals who have lost money due to the negligence of investors and brokers.
Hugh is a past President of the Public Investors Arbitration Bar Association (PIABA), an international legal association composed of practitioners who represent investors in disputes with the securities industry. He was also just re-elected to PIABA’s Board of Directors, where he has served as a director since 2011.