Current FINRA Chairperson Training

By Geoff Hafer, Fall 2016 Student Intern

In part three of this five-part series, we looked at “The Good and the Bad” of SR-FINRA-2016-033.  Of particular note was the concern that perhaps the reduction in the case experience requirement from two arbitrations to one arbitration would negatively impact the quality of the public chairperson roster.  By reducing the experience required of arbitrators, training becomes all the more significant.  So let’s take a look at the current FINRA Chairperson Training.

The Chairperson training itself can be completed entirely online.  The course consists of three sections entitled “Managing the Prehearing Process,” Managing the Hearing Process,” and Modifying the Procedures” spanning 77 pages in total.  The primary goal of the chairperson training course is to “enhance your leadership skills.” At the end of the course there is an exam, consisting of 25 multiple choice questions, where an arbitrator must score at least 80%.  The exam itself states “most arbitrators will be able to review the material, and complete the enclosed exam in six hours.”  To see the FINRA Arbitration Chairperson Training in its entirety, click here.  And that is the current state of chairperson training.  Is that enough?  If you are one of the investors who, like all of the clients of the Investor Advocacy Clinic at Georgia State University College of Law, will have their dispute decided by a single public chairperson arbitrator, are you confident they are adequately prepared?  Once again, the proposed rule change reduces the exposure that arbitrators have to live proceedings prior to assuming the role of a chair.

If this is the direction that FINRA must take in order to increase the pool of public chairperson arbitrators then the current FINRA chairperson training must be modified to accompany such a rule change.  In the final part of this five-part series, we will cover recommended changes to the current public chairperson training.