March 18, 2008
I am constantly amazed at what passes for FINRA's idea of fairness. Why are there only rules being proposed that govern how a brokerage firm can have a customer's claims dismissed? Where are the rules permittting a directed verdict in favor of a customer, such as where the broker already was convicted of a felony regarding the conduct alleged in the compaint, or where the broker has made admissions on the witness stand, or where the facts are not in dispute? Why does a FINRA arbitration always have to be a one way street in favor of the the brokerage industry?
Especially onerous is Rule 12504(b), allowing motions to dismiss after the presentation of a claimant's case in chief, which contains no guidance or restrictions whatsoever. In other words, FINRA has designed a perfect vehicle to have customer claims dismissed without giving the customer a fair opportunity to oppose a motion.
A simple rule is needed: Once the arbitration hearing commences, there should be no motions to dismiss permitted. Period.