The Financial Industry Regulatory Authority’s free, online service BrokerCheck, which tracks more than 670,000 securities professionals, has come under criticism for the number of customer complaints it erases, according to the New York Times.

Each year, BrokerCheck erases hundreds of complaints against brokers at the request of the brokers themselves. FINRA says it clears the records of brokers who have been unfairly accused by clients.

Brokers fiercely guard their professional reputations and often request confidentiality provisions and expungements upon settling with investors.

Last year, the Public Investors Arbitration Bar Association released a study that found FINRA expunged more than 98 percent of arbitration awards in 2006 in which the broker settled privately.

The vast majority of expungement requests are legitimate, said Timothy Burke, a securities lawyer at Bingham McCutchen.

“Many complaints in financial services are sour grapes,” McCutchen said. “The mere fact that a complaint was filed doesn’t mean wrongdoing.”

But not everyone agrees that complaints, even meritless ones, should be erased.

“BrokerCheck gives you no assurance that you’re dealing with somebody who has a clean record,” said Pat Huddleston, a former branch enforcement chief at the Securities and Exchange Commission, who now runs the website Investor’s Watchdog.

“Any complaints against a broker,” he said, “are things investors most want to know.”

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