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February 13, 2014 at 09:46 AM
The Financial Industry Regulatory Authority’s board on Thursday approved three rule proposals.
The first one would limit the number of times investor complaints may be expunged, or removed, from publicly available broker records maintained on FINRA’s BrokerCheck.
The board also authorized FINRA to seek comment on a revised proposal to require that firms that serve retail investors include a link to BrokerCheck on their websites. The proposal would not apply to email or text messages, a retail communication that is posted on an online interactive electronic forum (such as a message board, Twitter feed or chat room), or a directory or list of associated persons limited to names and contact information.
The third proposal would amend the customer and industry codes of arbitration procedure to refine and reorganize the definitions of “nonpublic” and “public” arbitrator. Among the changes include classifying individuals who worked in the financial industry for any duration as nonpublic arbitrators.
All of the rule proposals will be submitted to the Securities and Exchange Commission for review, public comment and approval.
Dave Bellaire, executive vice president and general counsel of the Financial Services Institute, said that FSI would review the new proposal on firms linking to BrokerCheck to see how “it addresses FSI’s previous comments.” FSI, he said, “will continue working with FINRA to develop a workable solution for our members that also provides investors with access to BrokerCheck information.”
The rule proposal addressing expungement of brokers’ black marks states that “firms and associated persons would be prohibited from conditioning settlements of customer disputes on, or otherwise compensating customers for, an agreement not to oppose a request to expunge information from an associated person’s Central Registration Depository (CRD) record.”
