Is It Necessary Under Rule 2080 to Obtain Court Confirmation of an Expungement Award?

Is It Necessary Under Rule 2080 to Obtain Court Confirmation of an Expungement Award?

Simply put, the answer is yes. FINRA Rule 2080 (“Rule 2080”) is complex and must be followed properly to obtain expungement of a customer complaint from an individual’s BrokerCheck report

Rule 2080 requires that a court of competent jurisdiction (state or federal court) confirm an expungement award before FINRA will remove a customer complaint from an individual’s BrokerCheck report and the Central Registration Depository (“CRD”). This includes arbitration awards issued after a decision on the merits and awards in which the parties have agreed to expunge customer dispute information as part of a settlement.

Rule 2080’s requirement is somewhat confusing given that the arbitration award is administered by a FINRA arbitration panel, however, FINRA will not honor the expungement under a court confirms its legitimacy. Additionally, the petition to confirm the arbitration award must name FINRA as a defendant in the petition to confirm the award, or request FINRA to waive that requirement.

The process of confirming an arbitration award is cumbersome and can be frustrating for an individual who was awarded expungement of a customer complaint. It is an additional legal process that requires an attorney who is knowledgeable about the various pitfalls in the confirmation process.

Although the battle for the award is won, the war is not over until the arbitration award is confirmed.

Call (201) 896-4100 or email info@sh-law.com to contact the Securities Litigation and FINRA Arbitration attorneys at Scarinci Hollenbeck, LLC.