This post first appeared on the Securities Arbitration Alert blog. The blog’s editor-in-chief is George H. Friedman, Chairman of the Board of Directors for Arbitartion Resolution Services, Inc.
FINRA has begun to post expungement-related stats on its Website.
For as long as we can remember, arbitrator-recommended expungement has been a topic of interest in the financial services field, and for nearly as long the Alert has been advocating that FINRA post expungement stats on its Website. The latter came to pass earlier this month: FINRA has added expungement statistics to the finra.org website, at https://www.finra.org/rules-guidance/key-topics/expungement-of-dispute-information#statistics (click on the “statistics” tab). We repeat below verbatim the intro to Statistics on Expungement of Customer Dispute Information in the FINRA Arbitration Forum (footnotes omitted):
Effective October 16, 2023, FINRA amended its rules to modify the process relating to requests to expunge customer dispute information from the Central Registration Depository (CRD®) in the FINRA Dispute Resolution Services (DRS) arbitration forum. The statistics below cover the three types of arbitration proceedings in which requests to expunge customer dispute information may be filed in the DRS arbitration forum on or after October 16, 2023:
- Straight-In Requests:expungement requests filed by an associated person (AP) separate from a customer arbitration (see FINRA Rule 13805 of the Industry Code).
- Non-Simplified Customer Arbitrations:expungement requests filed by an AP in an investment-related, customer-initiated arbitration that is not administered as a simplified proceeding (see FINRA Rule 12805 of the Customer Code).
- Simplified Customer Arbitrations:expungement requests filed by an AP in an investment-related, customer-initiated arbitration administered as a simplified proceeding, e., arbitrations involving $50,000 or less (see FINRA Rule 12800 of the Customer Code).
The statistics … below provide the total number of cases filed in the DRS arbitration forum that include an expungement request and, for cases decided by a panel, the total number of occurrences and the number and percentage of occurrences for which the arbitration panel awarded or denied expungement relief.
We reached out for a comment to Richard Berry, Executive Vice President of FINRA Dispute Resolution, who said:
“FINRA is committed to continuing to enhance its dispute resolution forum, and providing more transparency of expungement data is part of that commitment.”
(ed: *The numbers so far is not yet meaningful, but over time they will be. **There is also a link to the expungement statistics on the Dispute Resolution Services statistics page. ***Hats off to FINRA!)
