Each New England state has its own securities arbitration hearing location, although the parties can stipulate to change the location (with arbitrator approval) at their cost. The locations in each of the New England states and the number of awards appearing on FINRA's Arbitration database online for each location are as follows:
Maine: Augusta (8)
Massachusetts: Boston (513)
New Hampshire: Manchester (17)
Vermont: Montpelier (7)
Rhode Island: Providence (18)
Connecticut: Hartford (98)
The Boston location has been in use the longest, and that biases the results but only to a point -- over 200 hearings have been held in Boston since 2006, after all of the other hearing locations in New England had gone live. The Hartford hearing location came on line in March 2004, followed by Providence (December 2004), and Augusta, Manchester, and Montpelier (March 2005).
News and commentary from the Financial Services attorneys at Preti Flaherty.
What you don't know can't hurt you? -- Gaps in FINRA's BrokerCheck.
Thursday, March 6, 2014
A new study hot off the presses by the Public Investors Arbitration Bar Association (PIABA) raises tough questions about gaps in the Financial Regulatory Authority's BrokerCheck tool for checking the background and credentials of stock brokers and other licensed professionals in the scurities industry.
The PIABA report can be accessed on the organization's website here. The headline on PIABA's press release, "PIABA WARNING: FINRA WITHHOLDS CRITICAL 'RED FLAG' INFORMATION IN BROKER BACKGROUND CHECK DISCLOSURES TO INVESTORS." The call to action, "It’s Time to Harmonize FINRA and State Disclosures to Public: FINRA’s BrokerCheck Routinely Deletes Information about Bankruptcies, Tax Liens, Firings, Flunked Tests, Sales Practice Abuse Investigations, and Other “Red Flags” for Investors."
The Wall Street Journal has picked up the story here as well, pointing out that its own reporting showed that more than 1,600 brokers' records don't show personal bankruptcies and criminal charges that should be reported. Investment News published an article covering the story this afternoon here.
There are competing arguments as to how much information ought to be disclosed and whether certain information is actually useful to investors, but I fall in the camp that believes that more information is better. But wherever you draw the line between privacy and the public's right to know the good the bad and the ugly about investment professionals . . . PIABA reports that state regulators in many jurisdictions make public information that FINRA choses to excise from its BrokerCheck system. This would seem to undermine any privacy rationale behind FINRA's choice to release less information on BrokerCheck. If information is available from state regulators is there any good reason not to make that same level of information available to the public through BrokerCheck?
The PIABA report can be accessed on the organization's website here. The headline on PIABA's press release, "PIABA WARNING: FINRA WITHHOLDS CRITICAL 'RED FLAG' INFORMATION IN BROKER BACKGROUND CHECK DISCLOSURES TO INVESTORS." The call to action, "It’s Time to Harmonize FINRA and State Disclosures to Public: FINRA’s BrokerCheck Routinely Deletes Information about Bankruptcies, Tax Liens, Firings, Flunked Tests, Sales Practice Abuse Investigations, and Other “Red Flags” for Investors."
The Wall Street Journal has picked up the story here as well, pointing out that its own reporting showed that more than 1,600 brokers' records don't show personal bankruptcies and criminal charges that should be reported. Investment News published an article covering the story this afternoon here.
There are competing arguments as to how much information ought to be disclosed and whether certain information is actually useful to investors, but I fall in the camp that believes that more information is better. But wherever you draw the line between privacy and the public's right to know the good the bad and the ugly about investment professionals . . . PIABA reports that state regulators in many jurisdictions make public information that FINRA choses to excise from its BrokerCheck system. This would seem to undermine any privacy rationale behind FINRA's choice to release less information on BrokerCheck. If information is available from state regulators is there any good reason not to make that same level of information available to the public through BrokerCheck?
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