William Galvin, Secretary of the Commonwealth of Massachusetts, today
In a letter to the San Francisco-based firm, Sec. Galvin said that the firm violated FINRA’s rules prohibiting its members from preventing their own customers from joining civil class actions. For its part, FINRA recently
“Your firm’s recent comments praising the decision and claiming that customers are better served through FINRA arbitration are disingenuous,” wrote Sec. Galvin.
“It ignores the fact that by placing this arbitration clause in every brokerage account agreement as a matter of course, it denies an investor the basic opportunity to decide for him or herself what forum is in his or her best interest. The ruling is akin to giving every rogue broker-dealer the green light to steal from their customers in small dollar amounts.”