FINRA Amends Rules to "Incentivize Payment" of Arbitration Awards
FINRA adopted amendments to Membership Application Program ("MAP") rules to incentivize the timely payment of arbitration awards.
In its regulatory notice, FINRA describes key amendments to the MAP rules, including:
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a rebuttable presumption to deny a new FINRA membership application if an applicant or associated person is the subject of a pending arbitration claim;
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requiring new FINRA membership applicants to notify FINRA of any arbitration claim in which they or their associated persons are involved; and
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requiring new FINRA membership applicants subject to a pending arbitration claim to demonstrate their intention and their ability to pay the claim.
The final rule will go into effect on September 14, 2020.
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