Yesterday, the Securities and Exchange Commission (SEC) approved a Financial Industry Regulatory Authority (FINRA) plan to provide investor-claimants with an all-public arbitration panel option.
According to Investment News,
The approval follows a 27-month pilot program during which Finra gave certain investors the choice of eliminating the industry arbitrator on three-person panels and replace the arbitrator with a public panelist.
The Dodd-Frank Act directed a study of FINRA arbitration services and,
The legislation also gave the SEC explicit authority to ban or limit pre-dispute arbitration agreements.
The rule change announced yesterday does not affect disputes between brokerage firms or brokers.
Firm-versus-firm cases are heard by industry panels, and industry cases involving an individual broker are heard either by a single public arbitrator or majority public panel.
Read more about the newly approved plan here.
In September, Disputing discussed the FINRA proposal here.
Tags: arbitration, FINRA, News, securities arbitration
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