A rule change proposed by FINRA to raise the maximum dollar amounts for customer disputes that can go through simplified arbitration can minimize litigation costs for plaintiffs and defendants. However, it could also mean individual registered reps and RIAs holding any FINRA licenses may see more arbitration awards against them, according to a securities attorney.

FINRA filed a proposal with the SEC to amend FINRA’s code of arbitration procedure to raise the limit for simplified arbitration to $50,000 from its current $25,000. The SEC published the proposed rule change in the Federal Register at the end of February, and the comment period ends March 20.

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