is a registered representative who recently left ABC
Securities and has now registered with PDG Securities.
At the time he resigned from ABC, he had unpaid commissions
totaling $5,000. After repeated inquiries and several
months, Bob still has not been paid, nor has he been
given any definitive reasons why he hasn’t.
The best mechanism through which he may attempt to
recover his commissions would be:
a) Through the SEC’s mediation process.
b) By filing criminal charges in the state courts.
c) By filing for simplified arbitration under the NASD code.
d) By filing a suit in the state’s civil court system.
The correct answer is c.
Monetary disputes within the securities industry are settled through the NASD Code of Arbitration, rather than by litigation. The maximum amount to be considered under Simplified Arbitration is $25,000. Larger amounts go before the full arbitration panels.
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