Skip navigation

FINRA Postpones In-Person Hearings to End of February

The regulatory agency originally planned to resume arbitration and mediation proceedings at the end of January, but they can now proceed only via Zoom or teleconferencing.

FINRA is postponing all in-person arbitration and mediation proceedings another month, to the end of February 2021, according to the regulatory agency.

In-person proceedings were set to resume after Jan. 31, but FINRA decided to postpone further due to the continuing effects of the COVID-19 pandemic. This means that all hearings are on hold “unless the parties stipulate to proceed telephonically or by Zoom or the panel orders that the hearings will take place telephonically or by Zoom.”

Since the outset of the pandemic, FINRA has continued to hold virtual hearings throughout the country. The remote hearings have led to some legal challenges, with defendants in arbitration and disciplinary hearings alleging that their due process rights are being infringed by the use of teleconferencing. In one suit, attorneys for Alpine Securities alleged that the use of teleconferencing could make it difficult for attorneys to provide effective counsel.

The use of teleconferencing is all the more important when weighing the needs of harmed investors, who’d prefer a speedy and efficient decision with defendants. In a previous interview with, Bill Singer, a securities attorney and author of the blog, said a charged broker may only want to agree to the proceedings if their lawyer could be physically present.

“What COVID-19 has done is it’s creating a compelling rationale for claimants and respondents for why we should go forward with teleconferencing, and for why we shouldn’t,” Singer said.

But some suits concerning the question of virtual hearings have been unsuccessful; Carlos Legaspy, a broker and owner of the Illinois-based firm Insight Securities, argued his remote Zoom arbitration hearing was unfair because of the complexities of the case. But the judge in this case sympathized with FINRA. According to a note from the law firm Chilivis Grubman Dalbey & Warner, other brokers should be prepared for the possibility that their challenges to virtual hearings could meet similar fates.

“While other challenges to virtual hearings may yet prove successful, this ruling suggests that courts are not likely to allow litigants to use the COVID-19 pandemic and the prospect of a virtual hearing as an excuse to indefinitely delay the resolution of their disputes,” the note read. “After all, justice requires that claimants be afforded the right to recover their damages, and justice delayed is justice denied."

Want The Daily Brief delivered directly to your inbox? Sign up for's Morning Memo newsletter.

TAGS: Industry
Hide comments


  • Allowed HTML tags: <em> <strong> <blockquote> <br> <p>

Plain text

  • No HTML tags allowed.
  • Web page addresses and e-mail addresses turn into links automatically.
  • Lines and paragraphs break automatically.