Regulatory Notice 12-18

FINRA Requests Comment on Proposed New In re Expungement Procedures for Persons Not Named in a Customer-Initiated Arbitration

Comment Period Expired: May 21, 2012

FINRA is requesting comment on proposed new rules that would permit persons who are the “subject of” allegations of sales practice violations made in arbitration claims, but who are not named as parties to the arbitration (unnamed persons), to seek expungement relief by initiating  In re expungement proceedings at the conclusion of the underlying customer-initiated arbitration case. These allegations must be reported in the same way that customer complaints are reported—to the Central Registration Depository (CRD®) system on Forms U4 or U5. Currently, the Code of Arbitration Procedure for Customer Disputes (Customer Code) and the Code of Arbitration Procedure for Industry Disputes (Industry Code) (together, Codes) do not provide unnamed persons with express procedures to seek expungement of these types of allegations.

FINRA believes the proposed In re expungement rules and accompanying forms provide unnamed persons with a remedy to seek redress concerning allegations that could impact their livelihoods, yet maintain the protections of FINRA’s expungement rules to ensure the integrity of the CRD records, on which the investing public relies.

The text of the following proposed rules can be found at www‌.finra.‌org/industry/notices/12-18:

  • Rule 12100(z) (Unnamed Person);
  • Rule 12806 (Expungement of Customer Dispute Information by  Persons Named as Parties);
  • Rule 13100(cc) (Unnamed Person);
  • Rule 13806 (Expungement of Customer Dispute Information by  Persons Named as Parties); and
  • Rule 13807 (Expungement of Customer Dispute Information by   an Unnamed Person).

The proposed Notice of Intent to File an In re Expungement Claim (Notice of Intent to File) and Submission Agreement for In re Expungement Claims (In re Submission Agreement) forms are set forth as Attachments A and B, respectively.

Questions concerning this Notice should be directed to:

  • Kenneth L. Andrichik, Senior Vice President, Chief Counsel and Director of Mediation and Strategy, Dispute Resolution, at (212) 858-3915 or email; or
  • Mignon McLemore, Assistant Chief Counsel, Dispute Resolution, at (202) 728-8151 or email.

Related Documents: 

DateTitleFormat - Size
10/9/2015Attachment to Regulatory Notice 12-18PDF - 30.17 KB
The views, expressions, findings and opinions expressed in the comments on this Web page are solely those of the author(s) and FINRA accepts no responsibility for the content of the comments: 
DateCommenterFormat - Size
4/9/2012Seth E. LipnerPDF - 12.79 KB
4/10/2012Mike ReinhardtPDF - 37.96 KB
4/10/2012Judy & Charles EisenhardtPDF - 40.05 KB
4/13/2012Lawrence M. GreenPDF - 19.7 KB
4/16/2012Davidson & Grannum, LLPPDF - 211.4 KB
4/25/2012NPB Financial Group, LLCPDF - 37.13 KB
5/1/2012ARMPDF - 40.5 KB
5/1/2012Marlyn McClaskeyPDF - 10.08 KB
5/7/2012Kaufmann Gildin Robbins & Oppenheim LLPPDF - 427.86 KB
5/10/2012Keystone Capital Corp.PDF - 289.06 KB
5/10/2012St. John’s University School of LawPDF - 165.75 KB
5/18/2012PIABAPDF - 412.68 KB
5/18/2012Richard A. StephensPDF - 632.24 KB
5/21/2012REISAPDF - 393.37 KB
5/16/2012Woodforest Financial Services, Inc.PDF - 94.7 KB
5/21/2012SIFMAPDF - 85.35 KB
5/21/2012Financial Services InstitutePDF - 81.69 KB
5/21/2012NASAAPDF - 147.62 KB
5/21/2012Sutherland Asbill & Brennan LLPPDF - 215.34 KB
5/21/2012Wells Fargo AdvisorsPDF - 126.18 KB
5/21/2012Dobin Law Group, P.A.PDF - 59.18 KB
5/21/2012Barry D. EstellPDF - 16.02 KB
5/21/2012Morgan Keegan & Co., Inc.PDF - 86.06 KB
5/21/2012Regal Bay Investment Group LLCPDF - 14.82 KB
5/21/2012Herbert E. Pounds, Jr., P.C.PDF - 15.14 KB
5/21/2012Law Office of Richard M. LaynePDF - 134.69 KB
5/21/2012Bingham & Lea, PCPDF - 36.64 KB