A federal judge just shut down an advisor's attempt to erase customer complaints from his record by suing FINRA directly, reinforcing the regulator's grip over BrokerCheck.
If you have ever thought about taking FINRA to court to clean up your BrokerCheck profile, think again. A ruling handed down January 5 from a District of Columbia federal court makes clear that path is closed.
James Richard Tuberosa spent 38 years in the securities industry before his FINRA registration ended in 2022. During that time, he racked up 18 disclosure events on his BrokerCheck report. That included 14 customer complaints, two regulatory fines, and two terminations from member firms.
Last April, Tuberosa decided he wanted six of those customer disputes gone. So, he did something unusual. Instead of going through FINRA's arbitration process like most advisors do, he sued FINRA itself in federal court.
His reasoning seemed straightforward enough. FINRA Rule 2080 says anyone seeking expungement must get a court order directing it. Tuberosa figured that meant he could ask a court directly to order FINRA to scrub his record.
The six disputes he wanted removed stretched from 2002 to 2018. Three involved customers who dropped their complaints after his firms denied the claims. Two others allegedly came from customers who said in writing they were not even complaining, yet the firms reported them anyway. The last one settled in arbitration for a fraction of what the customers wanted, and Tuberosa said he never contributed a dime to the settlement.
Judge Beryl Howell was not buying it. Her opinion made clear that Rule 2080 simply tells FINRA to follow court orders when they show up. It does not give advisors the right to sue FINRA in the first place.
The court pointed to a long line of cases saying FINRA cannot be sued for doing its regulatory job. Congress gave FINRA the mandate to collect and keep registration information, including customer complaints. The Securities and Exchange Commission has said repeatedly that keeping this information complete protects investors and helps regulators do their jobs.
Tuberosa tried framing his lawsuit as a request for equitable relief, declaratory judgment, and a permanent injunction. The judge dismissed those as remedies, not actual legal claims. You need a reason to sue before you can ask for remedies, and Tuberosa had none.
He also asked to amend his complaint to name someone else as a defendant if FINRA was the wrong party. The court denied that request too, calling it too vague.
The practical takeaway for advisors is simple. If you want customer disputes removed from your BrokerCheck profile, your options remain limited to what they have always been. You can pursue expungement through FINRA arbitration under Rule 13805, or you can add your own explanatory comments under Rule 8312.
Suing FINRA directly is not an option, at least not according to this court. And given how many other courts have ruled the same way over the years, that is unlikely to change anytime soon.
“It’s time for an economic reset,” wrote the California governor, in a post on X.
Masterworks was launched in 2017 but its RIA, Masterworks Advisers, is just three years old.
One 2017 form, no broker license, and a $42 million gap they say surfaced on a webinar.
Fewer than half of Americans in their peak earning years feel on track for retirement, while many say limited financial knowledge and access to professional guidance are holding them back.
Meanwhile, Wells Fargo hauled advisors overseeing $825 million in the West Coast, while Wedbush has welcomed a seasoned professional from Stifel in California.
Dan Biagini of American Equity says the steady decline of pensions, longer lifespans and a reset in interest rates are rewriting how advisors build retirement income
Direct indexing is on pace to outgrow ETFs and mutual funds. Northern Trust's Ken Lassner explains why the advisors who get it wish they had started sooner.
