Close
ThinkAdvisor

Regulation and Compliance > Federal Regulation > FINRA

FINRA Plans Return of In-Person Arb Hearings in July

X
Your article was successfully shared with the contacts you provided.

What You Need to Know

  • FINRA had postponed in-person arb and mediation hearings due to the pandemic, but virtual hearings have been permitted.
  • Starting July 5, 62 of FINRA's 69 hearing locations will reopen for in-person proceedings.
  • The other seven locations will reopen in August, according to FINRA.

Starting July 5, the Financial Industry Regulatory Authority will reopen 62 of its 69 Dispute Resolution Services hearing locations for in-person arbitration and mediation proceedings, FINRA disclosed Monday in an update on its website.

FINRA started postponing in-person arbitration when the COVID-19 pandemic started in March last year. In April 2020, FINRA said it was extending the postponement of all in-person arbitration and mediation proceedings through July 3 last year due to the pandemic. Proceedings started to be held by Zoom or teleconference, but both parties have had to agree to such a meeting or it has had to be ordered by a FINRA arbitration panel. The postponement was later extended into July 2021.

The first FINRA arbitration award to involve a Zoom hearing was the $11.4 million award that a three-person FINRA Office of Dispute Resolution panel ordered B. Riley Financial subsidiary Wunderlich Securities to pay to New York-based investment firm Dominick & Dickerman and one of its executives, who were the claimants in an arbitration last year.

The only FINRA DRS hearing locations that won’t open July 5 are in Augusta, Maine; Boca Raton, Florida; Buffalo, New York; Detroit; Philadelphia; Providence, Rhode Island; and Wilmington, Delaware, FINRA said. FINRA DRS postponed all in-person proceedings at those seven locations through July 30.

Parties with cases set for in-person hearing or mediation sessions scheduled through July 30 in those seven locations will be contacted by FINRA DRS staff to discuss virtual hearing options or to reschedule their hearings, FINRA said. Those who want to continue holding hearings virtually will be able to do that even after July.

DRS has been monitoring each of its 69 hearing locations across the U.S. to assess when public health conditions would permit a general resumption of in-person arbitration and mediation proceedings in each location, it said.

However, if all parties and arbitrators in a dispute agreed to proceed in person based on their own assessments of public health conditions, their cases can proceed, as long as the in-person hearing participants comply with all applicable state and local orders related to the pandemic, FINRA said.

Pictured: FINRA building in Philadelphia. (Photo: Adobe Stock)