[20070518]RS22127_证券仲裁：公平的背景和问题.pdf

1 In May 2007, Chairman Patrick Leahy and Senator Russ Feingold of the Senate JudiciaryCommittee wrote to SEC Chairman Cox, saying that because of the prevalence of mandatoryarbitration clauses in brokerage contracts, the SEC should issue rules that better enabled investorsto freely choose between arbitration and the courts to address their grievances. Order Code RS22127Updated May 18, 2007Securities Arbitration: Background and Questions of Fairness Gary ShorterSpecialist in Business and Government Relations Government and Finance DivisionSummaryWhen an investor has a dispute with a broker-dealer in which damages of a certainsize or more are alleged, it may be mediated by a panel of securities industry and non-securities industry arbitrators under the auspices of the NASD. Although the processhas been criticized for having a pro-industry bias, research on the issue has notsubstantiated the bias claims. A smoothly functioning discovery process is integral tothe fairness of arbitration hearings. In recent years, in the wake of the market collapseof 2000, there has been a surge in reported abuse of the discovery process largelyconcerning brokerage firms. Incidents of abuse have attrac