The brokerage industry works hard to keep customer complaints out of public view, with aggressive firms fighting to remove grievances that sully their brokers' records. The interminable campaign to sanitize the dossier of former Royal Alliance Associates broker Kathleen J. Tarr is a disheartening case in point.
At a court hearing Friday, a lawyer for New York-based Royal Alliance made a case to a panel of three California appellate judges that a customer dispute -- one of 44 -- on Tarr's Finra records should be expunged.
It was but the latest in what's become an epic drama that could only take place in the wacky world of Wall Street's private justice system. More importantly, it's a screaming reminder that anyone who does business with a securities firm would be insane to assume that the stuff they read on Finra's online BrokerCheck tells the whole story.
Tarr wooed dozens of AT&T employees to open accounts when they were getting early retirement offers during a series of downsizings starting in 2007. By 2010, the complaints began to roll in, accusing Tarr of steering clients into portfolios of high-commission variable annuities and non-traded real estate investment trusts, or REITs. (Fifteen of the 44 complaints were either dropped by the investor or denied by her employer and never reached the point where an arbitration claim was filed.)
Now, she, her lawyer, and Royal Alliance are on a quest to scrub at least some of that information from her unsightly record. Should they succeed, the case will be deleted from the Finra BrokerCheck website, which is meant to give investors some insight into the brokers they may choose to work with.