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FINRA Panel Orders Expungement of U5 and CRD

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Feb 9, 2010 3:32 pm


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An irreverent Wall Street Blog
by Bill Singer

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High-Profile FINRA Arbitration BECK-ons once more.


Written: February 9, 2010

The high-profile Financial Industry Regulatory Authority (FINRA) arbitration In the Matter of the Arbitration Between Lance R. Beck and SunTrust Robinson Humphrey, Inc. (Amended Award FINRA 08-02482 / February 5, 2010)  has found a tortured path back onto the radar screen with a technical revision.  However, in recent weeks I have received an increasing number of calls from brokers troubled by U5 disclosures and ongoing issues arising from prior Auction Rate Securities (ARS) sales.  As such, Beck provides us with an excuse to re-visit that case and consider some of the still relevant issues.

Why does Beck matter?  For starters, the Panel awarded the registered person 

compensatory damages in the amount of $1,192,526.00; punitive damages in the amount of $2,500,000.00; costs in the amount of $50,370.95; and attorneys' fees in the amount of $419,057.50

But there is more.  The FINRA arbitration Panel l recommended a significant expungement from Beck's Central Registration Depository ("CRD") records and his Form U5 of all negative commentary involving an alleged customer complaint.