Wednesday, December 14, 2005

More on the NASD Appeal of an SEC Reversal

I have now reviewed the decision from the DC Circuit of the Court of Appeals. The background, as noted earlier, is that the NASD expelled a firm and its principal, the respondents appealed, ultimately to the SEC, which in effect reversed the NASD decision.

The NASD must have been pretty upset, because it filed a petition for review with the Court of Appeals. The problem is, the NASD does not have the authority to file such an appeal.

The opinion states that this has never occurred before, and that it has not occurred before since the NASD does not have the authority to file such a petition.

An interesting opinion, which confirms the historic practice. Respondents can appeal NASD and SEC decisions. The NASD cannot.

Thanks to John Baker from the Fund Law List for the link to the decision, which is online at Pacer.
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