SIFMA Submits Comments on FINRA-Proposed Rule Regarding Definitions of "Non-Public" and "Public" Arbitrator

SIFMA submitted comments to the SEC in support of the FINRA-proposed rule change regarding the definitions of non-public arbitrator and public arbitrator.

According to SIFMA, the stated purpose of FINRA's proposal is to address concerns about arbitrator neutrality. The rule change would provide that persons who worked in the financial industry for any duration during their careers would always be classified as non-public arbitrators, and persons who represent investors or the financial industry as a significant part of their business would also be classified as non-public arbitrators, but could become public arbitrators after a cooling-off period.

SIFMA stated it supports the proposal as it stands, and emphasized SIFMA's concerns that the rule change address the potential for bias from arbitrators favoring either investment banks or investors.

See: SIFMA Comment Letter. Related news: FINRA-Proposed Rule Change Relating to Revisions to Definitions of "Non-Public" and "Public" Arbitrator (Fed. Reg.) (July 3, 2014); FINRA Proposes Rule Change Relating to Revisions to Definitions of "Non-Public" and "Public" Arbitrator (June 18, 2014).