Lazaro Speaks on Expungement Process for Broker Misconduct

Christine Lazaro, who is currently serving as Acting Director of the Law School’s Securities Arbitration Clinic, recently spoke to Investment News about the expungement process that allows brokers to clear wrongdoing from their records.  Lazaro was appointed chair of the Public Investors Arbitration Bar Association’s Legislation Committee in October following the association’s annual meeting , after serving as chair and co-chair of the organization’s Self-Regulatory Organization committee for the past three years.

One of PIABA’s main agenda items this year (as set out in the article) is to influence legislation at the federal level.  As committee chair, Lazaro is responsible for coordinating the Hill Day’s agenda, which will include focus on mandatory arbitration and the issues with the expungement process.  This year, the committee will also focus on promoting legislation at the state level to prevent financial abuse of the elderly.

Following is an excerpt of the article:

“We’re taking a more active role in trying to impact legislation,” said Jason Doss, president of the Public Investors Arbitration Bar Association. “No other organization has the practical experience to talk about the real-life impact on investors when they’re given bad investment advice.”

Another issue that the group is trying to put on the radar of lawmakers is the so-called expungement process, or the method by which brokers can get wrongdoing cleared from their records in a database run by the Financial Industry Regulatory Authority Inc.

A PIABA study released in October found that expungement was granted more than 90% of the time between May 2007 and December 2011 when it was requested by brokers as part of a stipulated award or settlement.

“[Expungement] is getting a much closer look now that the PIABA study has come out and shown how frequently customer complaints are being expunged,” said Christine Lazaro, chair of the PIABA legislation committee and director of the Securities Arbitration Clinic at St. John’s University School of Law.


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