According to Investment News, the Financial Industry Regulatory Authority (FINRA) has barred 16 brokers from the industry through their High Risk Broker program established back in February 2013. The program targeted 42 rogue brokers using indicators such as complaints, terminations, arbitrations, and field reports, and put these brokers on fast track for regulatory actions. FINRA plans to expand the program in 2014 to included an enforcement team dedicated to prosecuting these cases.
The Investment News article stemmed from a letter written by FINRA chief executive Richard G. Ketchum in response to Sen. Edward Markery’s letter urging FINRA and the SEC to crack down on brokers who repeatedly violate securities rules and regulations. A majority of Mr. Markey’s letter discussed expungement of certain disciplinary actions from their broker record.
According to Investment News, Mr. Ketchum wrote “We are presently reviewing the overall expungemnt process. We are also considering additional rule changes to address the practice of conditioning settlements upon the investor’s agreement not to oppose expungement.”
Most disputes between brokers and investor are settled through arbitration. As part of the settlement agreement, many brokers include a clause that prohibits the investor from opposing the brokers request to have the dispute removed from their record. To learn more about expungement click here.
The foregoing information, which is publicly available, has been provided by The White Law Group. The White Law Group, LLC is a national securities fraud, securities arbitration, investor protection, and securities regulation/compliance law firm with offices in Chicago, Illinois and Boca Raton, Florida.
The firm primarily represents investors in claims against investment advisers and broker-dealers. If you believe would like to speak with a securities attorney regarding a potential claim against your broker, please contact the The White Law Group at 312-238-9650 free a free consultation.