Methods of Formal Dispute Resolution
Chapters in this video
- 0:00 The emu farm disaster: why arbitration exists
- 1:02 FINRA 12000 series and final, binding awards
- 1:38 Predispute arbitration clauses: required disclosures and prohibited provisions
- 3:09 Simplified arbitration and the $50,000 threshold
- 4:25 Panel composition: public versus non-public arbitrators
- 5:16 FINRA 13000 series: mandatory industry disputes
- 6:29 Arbitration timelines and consequences of unpaid awards
- 7:37 Rapid-fire exam recap
What this video covers
- Why FINRA arbitration is generally final and binding, and the extremely limited grounds for court reversal of an award
- The disclosure requirements for predispute arbitration clauses in customer agreements, and why FINRA does not require firms to include them
- Why class action claims cannot be brought in FINRA arbitration and why firms cannot include class action waivers
- How simplified arbitration works for disputes of $50,000 or less, including the default "on the papers" process and the customer's exclusive right to request a hearing
- The dollar thresholds that determine panel size: 1 arbitrator for $50,000 or less, 1 for $50,001 to $100,000 unless parties agree to 3, and 3 for over $100,000 unless parties agree to 1
- The default 2 public and 1 non-public arbitrator composition for three-member customer panels, and the customer's right to demand an all-public panel
- Why industry disputes under the 13000 series are mandatory for FINRA members and associated persons, with exceptions only for statutory discrimination and whistleblower claims
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