Wells Fargo is appealing a controversial court decision that accused the bank and its outside counsel with commiting fraud and perjury, and striking a secret deal with Finra in an arbitration proceeding.
Wells Fargo filed its appeal in the Superior Court of Fulton County, Ga., yesterday, seeking to overturn Judge Belinda Edwards’s ruling in January that Finra and Wells Fargo’s lawyer appeared to have a secret agreement to strike certain people from a list of arbitrators.
Wells Fargo said simply they are “seeking relief from all errors and rulings adversely affecting them.”
The ruling set off a Congressional inquiry into Finra’s arbitration process and pushed Finra last week to hire an outside law firm to conduct a review of its arbitrator selection procedures.
Finra, which previously denied problems with its system, hired the law firm of Lowenstein Sandler after criticism from both plaintiffs’ lawyers and lawmakers concerned about the findings.
Finra President and CEO Robert Cook announced the findings of the report will be made public.
“We take this matter very seriously. Finra recognizes the importance of maintaining trust in the system and is committed to ensuring the ... arbitration forum is operated in a fair and neutral manner,” Cook said in a statement.
In the January 25 ruling, Edwards concluded that Wells Fargo’s outside counsel, Terry Weiss, had a secret arrangement with Finra to keep certain people off the list of arbitrators in all of his cases.
As a result, Edwards granted a motion to vacate a 2019 arbitration award in Wells Fargo’s favor against two investors seeking to be made whole from losses totaling $1,178,446 in a merger arbitrage investment.
According to court documents, Weiss admitted that Finra, a private entity that acts as a self regulatory organization for the securities industry, provided him with a “subset” of arbitrators in which at least three people were removed from the list provided to the claimants.