Subject: File No. 4-606
From: Gerald e McCoy

September 3, 2010

I have just successfully completed a FINRA ARBITRATION in which i was awarded full recovery, costs, attorneys fees and interest. However i am very displeased with the process. The arbitrators failed to take into account fully the effect of state statute 61-1-22 Utah Uniform securities Act which ONLY allows binding arbitration where four minamin standards are applied if the claimant is found t have been liabled...whole restitution, 12% interest/anum,repondent must pay full costs and respondent must pay full attorneys fees. We now discover ther were errors made in calculationg the costs and attorney's fees that mean the claimant will loose all interest, will not be fully restored and claiant will have to pay more attorney's fees. When this was discovered FINRA was notified by the claimant but was informed that more than 10 days had passed since the award and both parties had not agreed to reopen so they would not reopen and i have no recource. Some of the math errors were the panels, taking interest away from principle, some were attorney add ons which must be paid per Utah Statuete for binding arbitration to be accepted as a remady by the State So now i have a mess.FINRA believes they are above state statutes.
Arbitrations are better than court, are faster and less formal but there is so much hearsay items allowed in with no recourse that issues are abscured.Get rules that are fair, abide by state laws, allow recourse where errors are made or arbitrators do not apply state statues and put reins on attorny's that know how to game the system to where they get their lions share and the agrieved party does not get anything.Where gross evidence exists...Brokerage house gave brokers zero information on the security so they could not have any way to satisfy the statues that require disclosuer of high risk items...they must award punitive damages These firms have nothing to loose and much to gain with no penalty. UBS made $40+ million in one day and will keep most of it and will do it again because there is no sever penalty. If you were only required to bring back the money you stole with no penalty, what deterent would this be?
In conclution: The system would work if rules to protect claimants were in place, a non involved party ran the program...come on do you really think a group controled by securities firms isn't biased tward securities? I get you believe the military should be self regulating. and there was recourse when thing oviousely have gone wrong.