Exclusive: Regulator plans purge of Wall Street arbitrators
Source: Reuters
Wall Street veterans would no longer be allowed to act as arbitrators in many legal disputes between investors and their brokerages under a proposal that a U.S. regulator will present to its board on Thursday, a person familiar with the matter said.
The plan by the U.S. brokerage industry self-regulator, the Financial Industry Regulatory Authority (FINRA), would mean that investors could opt to have their cases heard by a panel of three so-called public arbitrators who would not include people who had past industry ties.
That would not only exclude former bankers and brokers but also others, such as lawyers who worked on behalf of brokerages, even for brief periods in their careers, the person said.
FINRA allows people who have been out of the industry for at least five years - but who may have worked in it as many as 20 years - to hear cases as public arbitrators.
Under the ...
Read more: http://www.reuters.com/article/2014/02/10/us-finra-arbitration-idUSBREA191SI20140210
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