Barron's (October 19, 2017) - Finra wants to allow investors in arbitration to take their claims to court if their brokerages or brokers go bankrupt while arbitration is underway, InvestmentNews reports.

The brokerage industry self-regulator Wednesday released a notice proposing to amend its arbitration rules, the publication writes. The change would mean that investors have 60 days to withdraw claims from arbitration and file them in court. They can alternatively add other parties to their arbitration claims who may be able to pay any awards that are made. They can also change their pleadings, postpone hearings and get refunds on filing fees, InvestmentNews says.

Finra will take take public comments on the proposal until Dec. 18.

“The proposed amendment is intended to help further address the issue of unpaid customer arbitration awards by expanding the options available to customers,” Richard Berry, Finra executive vice president and head of the Office of Dispute Resolution, was quoted saying.

One critic says Finra can do better, however, according to InvestmentNews.

“The good news is it is an attempt to address the unpaid arbitration problem at Finra,” Andrew Stoltmann, president of the Public Investors Arbitration Bar Association, is quoted saying. “The bad news is that it is such an incremental, de minimus step that it will have virtually no impact on solving the problem. All it does it push unpaid arbitration cases from Finra’s docket to a court. The only true solution is for Finra to establish an unpaid-arbitration pot for investors who get stiffed in arbitration.”

Stoltmann’s organization found that arbitration winners were unable to collect $62 million in awards in 2013, InvestmentNews writes. That’s one-quarter of all arbitration awards that year.

But Finra says the latest proposal isn’t the only thing it will do to address the problem.

“This request for comment represents just one step in our continuing work on a very complex issue,” Finra spokeswoman Michelle Ong told the publication.