FINRA Amends Code of Arbitration Procedure to Protect Personal Confidential Information

Amendments to the FINRA Code of Arbitration Procedure for Customer and Industry Disputes aimed at protecting personal information became effective on July 28, 2014. The amended Rules 12300 (Customer Code provision) and 13300 (Industry Code provision) require parties filing documents with FINRA that contain an individual’s Social Security Number, taxpayer identification number or financial account number to redact the information and include only the last four digits of any such number. Documents containing information which is not redacted will be deemed deficient under the new rules. In addition, failure to follow the new rules can cause a claim, counterclaim, cross claim or third party claim to be rejected. The new rules do not apply however to: (1) documents that parties exchange with each other and do not file with FINRA; (2) documents that parties submit to a panel at a hearing on the merits; and (3) documents filed pursuant to FINRA Simplified Arbitration Rules (claims for $50,000 or less).

The FINRA Notice and text of the rule changes can be found here:                               http://www.finra.org/web/groups/industry/@ip/@reg/@notice/documents/notices/p540974.pdf