FINRA to Scrutinize Arbitrators

According to recent reports, FINRA intends to beef up its scrutiny of the neutral arbitrators within its arbitrator pool by performing “background checks” on such arbitrators annually and when a panel is appointed to hear a case, according to a FINRA spokesperson.  Previously, according to a Wall Street Journal article on the topic, such background checks only were performed when an arbitrator first applied to join FINRA’s roster.

The move comes in response to a lawsuit alleging that a New Jersey-based FINRA arbitrator had presided over a hearing without first disclosing significant legal problems that he was facing (according to reports, the arbitrator was indicted in New Jersey for practicing law without a license and was suspended from practicing law in Michigan for the New Jersey incident and for writing $18,000 in bad checks).

The foregoing information is provided by Amato Law Firm, LLC and Chicago securities lawyer Ronald M. Amato.  Mr. Amato is an experienced securities lawyer with substantial experience representing financial advisors, broker-dealers and investors in securities arbitration, employment transitions, and securities-related employment and regulatory matters.  He can be reached at 312.466.5521 or through the firm’s website at

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Ronald M. Amato, managing member of Amato Law Firm, LLC, is an experienced securities arbitration attorney. He represents investors, financial advisors, investment advisory firms and broker-dealers in FINRA arbitration, securities arbitration and securities-related employment and regulatory matters.
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