Judge Vacates Arbitration Award, Condemning ÍøÆØ³Ô¹Ïlls Fargo, Attorney and FINRA
From the Desk of Jim Eccleston at ÍøÆØ³Ô¹Ï:
A Georgia Superior Court judge has vacated an arbitration award that ÍøÆØ³Ô¹Ïlls Fargo had obtained nearly 3 years ago involving a client who sued the firm for mismanaging his account and, in doing so, has rocked the industry with sweeping, serious allegations of misconduct and conspiracy.
Along with dismissing the July 2019 decision in which ÍøÆØ³Ô¹Ïlls Fargo had prevailed, Fulton County Superior Court Judge Belinda Edwards criticized the process of arbitration selection by the Financial Industry Regulatory Authority (FINRA) when it came to one lawyer representing ÍøÆØ³Ô¹Ïlls Fargo, Terry ÍøÆØ³Ô¹Ïiss.
Any alteration to the selection process would violate industry rules and deviate from the decades-old protocol that requires a computer-generated list to select neutral panelists. Judge Edward scrutinized the FINRA arbitration system and its potential to employ impartial arbitrator panels, who ultimately determine whether the broker-dealer or investor should prevail.
Specifically, Brian Leggett filed a FINRA arbitration claim against ÍøÆØ³Ô¹Ïlls Fargo alleging that the firm failed to sufficiently monitor and supervise two advisors who mismanaged his account. Leggett lost his claim in 2019 as three FINRA arbitrators denied the allegations against ÍøÆØ³Ô¹Ïlls Fargo. An appeal followed. After reversing ÍøÆØ³Ô¹Ïlls Fargo’s victory, Judge Edwards scrutinized FINRA, ÍøÆØ³Ô¹Ïlls Fargo and its attorney Terry ÍøÆØ³Ô¹Ïiss for permitting manipulation of the choice of arbitrators that ultimately would favor the brokerage firm over the client. According to the court order, FINRA permitted ÍøÆØ³Ô¹Ïiss to alter FINRA’s “neutral list” of arbitrators in the Leggett case, which unfairly tipped the scale of justice.
The industry is in an uproar. Significant ethical, regulatory, civil and perhaps even criminal issues face ÍøÆØ³Ô¹Ïiss, ÍøÆØ³Ô¹Ïlls Fargo and those individuals at FINRA who negligently or knowingly participated in this scheme.
ÍøÆØ³Ô¹Ï LLC represents investors and financial advisors nationwide in securities, employment, regulatory and disciplinary matters.
Tags: eccleston, eccleston law, arbitration, wells fargo, finra






