April 7, 2009
The purpose of this letter is to provide the Securities and Exchange Commission (SEC) with comments on the above referenced proposed rule change which was filed by the Financial Industry Regulatory Authority, Inc. (FINRA) on March 6, 2009.
I am an attorney whose practice is exclusively devoted to the representation of public investors in their disputes with the securities industry.
Moreover, I am a current member of FINRAs National Arbitration and Mediation Committee and a past President and a current member of the Board of Directors of the Public Investors Arbitration Bar Association.
It is my opinion that the portion of the proposed rule change, which would require brokerage firms to report, as customer complaints, allegations of sales practice violations made in arbitration claims and civil lawsuits against registered persons who are not named as parties in those proceedings, would:
1. benefit regulators, investors and the industry
2. resolve the current inconsistent treatment regarding the reporting of alleged sales practice violations and
3. recognize that the practice of making a brokerage firm the sole respondent in an arbitration claim has become more prevalent notwithstanding the fact that the underlying allegations involve sales practice violations against a registered person.
Accordingly, I would request that the SEC approve the proposed rule change on an accelerated basis.