This week, Finra proposed a rule that would prohibit brokers from removing customer complaints and certain arbitrations that are more than a year old.

The action by Finra addresses a growing number of brokers who are asking to have old complaints erased.

As Financial Advisor reported in July, the number of brokers seeking to clean up old disciplinary records has doubled from a year ago.

What’s more, arbitrators hearing these cases grant expungement around 90 percent of the time.

That fact has got critics of the expungement process upset.

The reason for the proposed one-year ban is that “enterprising defense lawyers have been soliciting brokers to clean up their records going back 15 years,” said Andrew Stoltmann of the Stoltmann Law Offices in Chicago and president of the Public Investors Arbitration Bar Association. “That’s very clear, problematic conduct because the investor is often not around [to dispute an expungement], and claimants’ lawyers probably forget what happened in the case.”

If a complaint is inaccurate and factually impossible, brokers can get it expunged, he said. “But don’t wait 15 years to do it.”

Finra says much the same thing. The one-year limitation period “would ensure that the expungement hearing is held close in time to the underlying customer case, when information … is available and in a timeframe that would increase the likelihood for the customer to participate” in the expungement hearing, Finra said in its notice laying out the proposal.

Finra is taking comments on the plan until February 5.

State regulators and the plaintiffs’ bar look likely to be lined up against industry groups in debating the new statute of limitations on expungements, as well as the use of specially trained arbitrators to hear cases.

Finra’s proposal is “a step in the right direction to begin addressing our concerns about the frequency with which customer complaints are removed from regulatory records,” said Joseph Brady, executive director of the North American Securities Administrators Association, in a statement.

While the integrity of the BrokerCheck disciplinary database needs to be maintained, Finra policy “must also be balanced with financial advisors' need to expunge information from their record that has no meaningful regulatory or investor protection value,” said David Bellaire, general counsel of the Financial Services Institute, in a statement.

Katrina Cavalli, a spokesperson for the Securities Industry and Financial Markets Association, said the trade group was still reviewing the proposal and had no immediate comment.

The debate will be “a function of the recognition that [expungements] shouldn’t be completely open-ended,” said plaintiffs’ lawyer Philip Aidikoff, of Aidikoff Uhl & Bakhtiari in Beverley Hills, Calif., who also represents brokers.

“Whether it’s a year or longer is something that’s going to get hashed out,” he said.