FINRA has recently altered the way arbitrations for brokers who bring complaints against their firms are handled; if you recollect in early August FINRA heralded a pilot program that allows clients to decide whether they desire an industry arbitrator on their panel or not. So now financial advisors will face a panel consisting of 2 public arbitrators along with one arbitrator from the industry effective August 31, 2009.
Responses are mixed on this…some stockbrockers suppose they will profit since the panel of industry arbitrators were usually lawyers that represented the brokerage firms, and too often the financial advisor felt they were not getting a reasonable hearing.
However not everyone is agreeing; the other position is stating that the public arbitrators will be unjust and inconsistent because they do not have a good understanding regarding the “inner workings” of the industry. Some people allege this shift is a result of pressure that FINRA has been facing that the process was skewed towards the business firms.