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EFL Arbitrations and U5 Expungement at FINRA

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Apr 13, 2010 11:00 am
An irreverent Wall Street Blog
by Bill Singer 
 Two Citigroup FINRA Arbitrations. Another Arbitration with an Odd Settlement -- or was there one? Written: April 12, 2010







When advisors lose their jobs but decide to keep loans or other payments from their former employers, expensive legal trouble can follow. The issue is how much, if any, of the money they received when they first joined the company is cash they are entitled to keep when they depart. Read Bill Singer's April  2010 Street Legal  column at Registered Rep. magazine to learn about two very different outcomes involvings Citigroup.

In the Matter of the Arbitration Between Robert Stephen Willoughby, Claimant, versus Weatherly Securities Corp., Respondent (FINRA 09-03378, March 31, 2010) Claimant Willoughby asserted Tortious Interference With Business Expectancy, Breach Of Contract, And Defamation on his Form U5. Among his demands for relief, Claimant sought $5,000.00 in compensatory damages, attorneys’ fees, and expungement from his CRD record of allegations of an unauthorized trade and the basis for termination as an alleged sales practice violation.  Respondent did not enter an appearance.

No Show – No Surprise

Generally, in cases where one party doesn’t show up or even submit a reply, that case isn’t likely to come out well for the missing litigant.  Willoughby offers no surprises in that regard. The FINRA Arbitrator hearing this uncontested matter awarded $5,000 in compensatory damages to Claimant and $175 in costs.

Out, Out Damn Spot!

The Arbitrator further recommended the exupungement from Claimant’s CRD records of all reference to a claim of an unauthorized trade on February 14, 2000 (complaint received on March 20, 2000), with the understanding that the process detailed in Notice to Members 04-16 must be filed to obtain confirmation from a court of competent jurisdiction.


Apr 13, 2010 1:39 pm

Are there any cases where the advisor wins against his former firm and does not owe the money?  I don't want to file a counterclaim, but I do have dirt on my old firm such as some compliance things that they do not follow at all.

Apr 13, 2010 11:20 pm

Every firm has compliance issues. I doubt it will help. You should send rrbdlawyer (Bill Singer) a PM and be careful of what you post in public.