Despite Obstacles, HLBS Law Succeeds in Expungement

July 1st 2024

by Owen Harnett

Summary of Keypoints

Attorney Michael Bessette of HLBS Law successfully obtained a FINRA arbitration award recommending expungement of five customer dispute disclosures for a financial advisor after a lengthy and complex process.
The advisor had previously been denied expungement on all five disclosures, but Mr. Bessette vacated that initial arbitration award; when the claims were refiled, FINRA initially deemed them ineligible for arbitration.
Following a separate success before the SEC, Mr. Bessette was able to restore the advisor’s access to the FINRA arbitration forum and present the expungement claims to a new arbitration panel.
The subsequent arbitrator found sufficient evidence supporting expungement and recommended removal of all five disclosures, concluding they were based on false information.

In a recent arbitration case, Attorney Michael Bessette successfully obtained an award in FINRA arbitration recommending expungement of five customer dispute disclosures. This case had a long road to get to this point, as the financial advisor previously sought expungement and was denied expungement on all five customer dispute disclosures by the FINRA arbitration panel. Mr. Bessette was able to successfully vacate that arbitration award, but when the claims were refiled seeking expungement, FINRA denied the financial advisor access to its arbitration forum, stating that the claims were “ineligible” for arbitration.

However, due to a separate recent success before the SEC, Mr. Bessette was able to get the financial advisor’s expungement claim back into FINRA arbitration and before a subsequent arbitration panel.

This time around, the arbitrator agreed that there was sufficient evidence in support of expungement, and recommended expungement of all five customer dispute disclosures. Mr. Bessette was able to prove that all five occurrences must be expunged due to false information.

FINRA has now passed new rules that have increased the intricacies of seeking expungement, and you will need an experienced team to navigate those new rules. Call HLBS Law today for a free consultation!

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Owen Harnett

Owen Harnett is the Founder and Managing Attorney of HLBS Law, where he represents financial professionals nationwide in FINRA arbitration, expungement matters, and U4/U5 termination defense. With more than a decade of experience and over 1,000 client matters handled, Owen is known for his strategic, client-focused approach to protecting advisors’ careers and reputations.