FINRA Requests Comments on Proposed Amendments Related to the Expungement of Customer Dispute Information.

Last month, FINRA issued Regulatory Notice 17-42 requesting comments and proposing amendments to the procedures relating to the expungement of customer dispute information from the Central Registration Depository (“CRD”) system and FINRA BrokerCheck system.  The proposed amendments include significant substantive changes that impact the timing and procedures for reviewing expungement requests, including:

  • Requiring the associated person to appear at the hearing in-person or by videoconference (not telephonically);
  • Requiring a three-person arbitration panel to make a unanimous finding that expungement is appropriate under Rule 2080(b)(1) and that the “customer dispute information has no investor protection or regulatory value.”
  • Creating limitations on requests for expungements, including a one-year limitation period after an underlying customer arbitration settles to file an expungement request.  With regard to customer complaints, a one-year limitation period from the date the member firm initially reported the customer complaint to CRD.
  • Establishing a roster of public chairpersons with additional qualifications and training to decide expungement requests (Expungement Arbitrator Roster).

To read the complete regulatory notice, click here: Regulatory Notice 17-42 |   FINRA’s comment period expires February 5th.  For more information about expungements, please contact our office for a complimentary consultation.

Status Report on FINRA Dispute Resolution Task Force Recommendation: February 8, 2017 Status Report

There are several proposals in various stages of the rulemaking process, including a rule that would provide for the expedited resolution of small customer and intra-industry disputes in claims involving $50,000 or less.  Another pending rule includes FINRA notifying state securities regulators when brokers make a request for expungement relief.  The SEC previously approved two proposals involving the selection of all public panels and the rules governing motions to dismiss, which became effective in January 2017.

Read FINRA’s February 8, 2017 Status Report »

FINRA fines Credit Suisse over anti-money laundering policies

Reprinted from Reuters

The Financial Industry Regulatory Authority said on Monday it has fined Credit Suisse’s U.S.-based securities business $16.5 million for ineffective anti-money laundering programs.

FINRA, the securities industry self-regulator, found that Credit Suisse Securities (USA) LLC relied on its brokers to identify and report suspicious trading, which did not always happen.

FINRA also found the effectiveness of its automated system used to monitor suspicious transactions was impeded because many of the data feeds were missing information.

FINRA was careful to say it did not find that Credit Suisse or any employees committed fraud or deceptive acts.

A Credit Suisse spokesman said the bank was pleased with the settlement.

“We cooperated with FINRA’s inquiry and have been taking appropriate internal remedial efforts,” a spokesman said.

The bank neither admitted nor denied the charges.