SIFMA Submits Comments to SEC on Proposed FINRA Rule Regarding Prohibited Conditions Relating to Expungement of Customer Dispute Information

SIFMA submitted comments to the SEC in support of a proposal for the adoption of new FINRA Rule 2081, which would prohibit member firms and associated persons from conditioning or seeking to condition the settlement of a dispute with a customer on, or to otherwise compensate the customer for, their agreement to consent to the firm or associated person's request to expunge such customer dispute information from the Central Registration Depository System.

According to SIFMA, the proposed rule is "appropriately tailored and designed to discourage the practice of conditioning settlement agreements on expungement relief requests." SIFMA stated that it hopes the rule will help allay any misperception that expungement relief is being requested or granted on anything other than appropriate grounds.

See:SIFMA Comment Letter.Related news: FINRA Proposes Rule Regarding Prohibited Conditions Relating to Expungement of Customer Dispute Information (Fed. Reg.) (with Lofchie Comment) (April 23, 2014); FINRA Proposes Rule Regarding Prohibited Conditions Relating to Expungement of Customer Dispute Information (April 14, 2014).