The Financial Industry Regulatory Authority has sent its changes to its expungement process to the Securities and Exchange Commission for approval.
FINRA’s plan would, among other changes, create a roster of arbitrators with enhanced training and experience to decide whether to expunge customer complaints. The arbitrator panel would be selected in certain instances to decide an associated person’s request to expunge customer dispute information.
FINRA’s board approved the expungement changes in October 2019.
The rule would also establish procedural requirements that arbitrators and parties must follow for expungement hearings, and set up requirements for notifying state securities regulators and customers of expungement requests.