The Investor Advocacy Clinic’s Spring 2015 Student Interns recently commented on SR-FINRA-2015-003, a proposed rule that would increase the honorarium to arbitrators for a party’s late cancellation of a scheduled hearing. The proposed rule would result in a $600 per arbitrator honorarium if a hearing is cancelled or postponed within ten business days of the scheduled hearing date. The Investor Advocacy Clinic’s comment suggested that while it is important to compensate arbitrators for their time and lost opportunities, the rule as proposed goes too far in both cost to investors and notice required before the fee is assessed. We instead proposed either that small investors be excluded from the rule change or that FINRA enact a phased cancellation/postponement fee. A phased fee would pay $100 per arbitrator if a hearing is cancelled or postponed between ten and four business days before a scheduled hearing. The fee would rise to $600 per arbitrator if a hearing is cancelled or postponed three or less business days before a hearing. We believe these alternatives are necessary to ensure that smaller investors are not disproportionately impacted by the rule change. Read our full comment here.