On December 20, 2022, a FINRA arbitration panel unanimously found in favor of GK’s client on a request to expunge two written customer complaints from his Central Registration Depository (“CRD”) Record. Both customers participated in the expungement hearing and opposed the request.
Expungement is considered an extraordinary remedy, and FINRA Rule 2080 specifies three narrow grounds to obtain expungement of customer dispute information from the CRD system:
– the claim, allegation or information is factually impossible or clearly erroneous;
– the registered person was not involved in the alleged investment-related sales practice violation, forgery, theft, misappropriation or conversion of funds; or
– the claim, allegation or information is false.
See FINRA Rule 2080(b)(1). Following a four-hour evidentiary hearing with dozens of exhibits, and testimony from both GK’s client and the customers, the arbitration panel made affirmative findings of fact that the claims, allegations or information were false and granted the expungement request.
For more information about FINRA expungement proceedings, please contact Kim Koves at email@example.com or 813-347-5111.