Despite The Passing of Time & Other Obstacles: Another Success Story Prevails

HLBS Law was successful in obtaining an arbitration award this month, that recommended expungement for a client. Chelsea Bauer was the attorney who represented the client throughout the arbitration process.

The customer complaint originated from the market meltdown in 2008. As was common at the time, panic overtook reason and clients sold their positions, which resulted in losses. This was the case Ms. Bauer was tasked with when it was filed in 2022. In addition to the meltdown in markets, the customer was also located in Mexico City, Mexico. FINRA arbitration requires that the customer be served with notice.

Ms. Bauer was able to complete service to the customer, despite the time passed since the complaint was made in 2008. Ms. Bauer argued that the complaint should be expunged pursuant to FINRA Rule 2080, that the complaint is false. The arbitrator considered the testimony and evidence provided, which resulted in a recommendation for expungement of the occurrence. The final step for removal of the occurrence is to get the arbitration award confirmed in a court of competent jurisdiction.

While this is a success story for our client and a complaint clearly caused by a once in a lifetime meltdown of the market, the new FINRA rules that were implemented in October of 2023, would make this customer complaint ineligible for expungement due to lapse in time.

However, HLBS Law is still able to take on certain customer complaints that would not be eligible for expungement in FINRA arbitration. Often times, advisors may be unaware that a complaint can be removed by expungement. If you are ever unsure whether you have a case or not, reach out to us here at HLBS to find out if there is a way we can help. In addition, we can take on other expungements that are eligible for FINRA arbitration but can be taken in a less adversarial route with a higher chance of success considering the new FINRA rules that were passed. Please contact us today if you would like to learn more about expungement of disclosures on your CRD and the impact of the new FINRA rules passed in October of 2024.