Expungement Procedures in a Customer-Initiated Arbitration

SIFMA provides comments to the Financial Industry Regulatory Authority (FINRA) on proposed new In Re expungement procedures for persons not named in a customer-initiated arbitration, FINRA Regulatory Notice 12-18.  The proposal would establish a procedure to permit persons who are not parties to a customer arbitration, but who are the “subject of” alleged sales practice violations that are required to be reported to the Central Registration Depository (CRD), to obtain expungement relief through an In re proceeding at the conclusion of the underlying customer arbitration.  SIFMA supports FINRA’s proposed rules establishing a process to file and prosecute In re expungement applications, and offers its recommendations and comments on the proposal.