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  • Steven Lee

Achievement Unlocked: FINRA Arbitrator!

One week ago, I was informed that my application to join the ranks of the Financial Industry Regulatory Authority's (FINRA) roster of arbitrators was approved. Ever since I entered the financial services industry, I have wanted to do this. It has been a long time coming, and I am glad that I finally have the opportunity to serve.


Applicants to join FINRA's arbitrator pool must endure a 90-day application review process (the app itself takes a couple of hours to complete). During the 90 days, the application undergoes a three-stage review process--the basic FINRA review, the escalated/more in-depth review, and the National Arbitration and Mediation Committee (NAMC) review. If the applicant passes the review process, (s)he is then invited to participate in two online training modules. These take several hours to complete and include a multiple choice test each. Trainees are then given two attempts to pass each exam. After passing, candidates attend either an in-person or telephonic orientation. Then, the newly-minted arbitrator is ready to serve.


Within financial services, most companies require clients to sign an arbitration agreement. This keeps legal costs down (at least in theory) and offers customers easy access to the justice system. Many clients represent themselves, and FINRA is pretty good about walking people through the process. Perhaps the best part about arbitration is that customers can force firms with which they have done business to participate. Similar to small claims court, customers who file grievances may proceed without law degrees or any knowledge about proper procedure (in fact, FINRA arbitrators are not required to follow the federal rules of evidence).


I greatly look forward to serving as an arbitrator because I believe it will align closely with my research interests, strengthen my mission to uphold virtues of fairness and justice within the financial services industry, and will make me a better financial planner. While I will never be able to comment on particular cases, even after they are over, my experience as an arbitrator will inform both my academic and practical endeavors. Additionally, it will build experience for future career paths and broaden my perspective about advisor-client interaction, investor behavior, and expectation management.




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