December 3, 2010
I strongly support the proposed rule change to allow customers the option to select an All Public Panel. Although no longer employed by a member firm, for 13 years I held various positions in the brokerage industry – from a registered representative to General Counsel and Chief Compliance Officer of several member firms. In these capacities, I have been responsible for managing and trying hundreds of arbitration matters. At this juncture, the integrity of the arbitration process is at stake and, as noted in the rule proposal, there is now more than a perception of bias or partiality. Public customers forced to arbitrate are challenging the fairness of having an industry arbitrator and, in some instances, raise Due Process issues, which could be the beginning of the end of the arbitration process as we know it.
For those customers not wishing to have an experienced industry person on a panel, the choice is theirs. For those who find value in the industry panelist, the choice will remain theirs as well. Given the significant number of challenges to arbitration awards by both Claimants and Respondents, it seems quite simple to remove any perception of bias for or against the member firms by allowing Claimants to choose the composition of the panels