FINRA's Overhaul of Arbitrator Selection System Moves Forward
From the desk of Jim Eccleston at ÍøÆØ³Ô¹Ï
FINRA has received approval to revamp its procedures for removing arbitrators from the three-member panels responsible for arbitration matters involving claims between and among financial advisors, their firms, and customers.
The changes, among other things, formalize FINRA's existing practice of allowing arbitrators to be replaced before an arbitration hearing commences. They also mandate that the director of dispute resolution services must document the reasons for accepting or rejecting a request to remove a specific panel member.
Under the new rule, arbitrators can be removed due to various conflicts of interest, such as prior dealings with a party involved in a particular case. The rule further requires the director of dispute resolution services to meticulously review the arbitrators' names on the shortlist for a given case to identify and address these conflicts.
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Tags: eccleston, eccleston law, finra






