Wednesday, October 7, 2009

FINRA Seeks Further Erosion of Broker Rights - BrokerCheck Forever

FINRA has proposed rule SR-FINRA-2009-050 under which it would permanently disclose a condensed record for any broker who has been fined, suspended or barred by securities regulators on its Internet based Broker-Check system. The proposed rule was published in the Federal Register on August 17, 2009 and the SEC solicited comments for submission on or before September 8, 2009.

Broker-check has been a significant intrusion into the private and personal lives of employees of the brokerage community for years. Is there any other industry or profession where such detailed information regarding allegations (not proof; allegations) of wrongful conduct are available to the public?

Broker-check was designed to allow the investing public to review information regarding their broker and potential broker. Therefore there is no reason to keep making this information public after the broker has left the industry.

That is not to say that a broker's record should be removed forever. A broker's CRD record is always available from FINRA, and all 50 state securities regulators, it is just not available on the Internet for the entire world to view.

Customer allegations are simply that - allegations. Unproven, unsworn, untested allegations by customers against brokers should never be publicly disclosed, and help no one. Why in the world would anyone want to continue the damage caused by this continued violation of broker's privacy rights?
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