Former AllianceBernstein mutual fund sales manager John Carl won a $12 million arbitration lawsuit for having been dismissed from the company on the pretext of his role in the market-timing scandal.

FINRA last month ordered Alliance to pay Carl $10 million in compensatory and $2 million in punitive damages. Rather than stating in the SEC U-5 termination report that Carl was “permitted to resign” in connection with the scandal – which cost Alliance $600 million, the highest settlement fee of any company involved – the arbitration panel has ordered the firm to say he was terminated without cause.

Frederick O’Meally, a former broker at Prudential Securities, won a similar, $3.8 million defamation lawsuit at the NASD in 2006, as did three former Merrill Lynch brokers the same year when a New York Stock Exchange arbitration panel awarded the three $14 million, including $12.5 million in lost income, pain and suffering.

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