The court found that “factual evidence presented by the investors leads to its factual finding that Wells Fargo and its counsel committed fraud on the arbitration panel by procuring perjured testimony, intentionally misrepresenting the record, and refusing to turn over evidence until after” closing arguments in the arbitration case.
Finra denied the court’s findings at the time. “There has never been any agreement between Finra Dispute Resolution Services and attorney Terry Weiss regarding appointment of arbitrators. Any assertions to that effect are false,” Finra spokeswoman Michelle Ong said.
Ong said at the time that Finra has reviewed all cases involving Terry Weiss as counsel and “none of the three arbitrators in question was excluded or removed from ranking lists prior to sending the lists to the parties," she said.
“As the neutral administrator, we continually strive to make the Finra forum the fairest, most efficient program available and stand behind the integrity of our neutral list selection process,” Ong added.
Michael Edmiston, president of the Public Investors Advocate Bar Association (PIABA), has been among those critical of Finra in the wake of the ruling.
“The problem here is you don’t know the scope of how badly the system is stacked against investors,” said Edmiston, who is also a former senior staff attorney at Finra. “You don’t know what other secret agreements firms have with Finra. It is just this one attorney or multiple attorneys with numerous firms who have created this secret process. You literally just do not know.”