Investors’ Attorneys Want $100M FINRA Fee Rebate for Unpaid Arbitration Awards
The investor advocacy group argues the surplus funds should go toward unpaid arbitration awards owed to defrauded clients.
Patrick Donachie,Senior Reporter,Wealth Management
March 24, 2026
A group representing investors’ attorneys is criticizing FINRA’s second member fee rebate in two years, with the organization’s leader calling it a “parody of justice.”
Last week, the brokerage regulator announced its Board of Governors approved a $100 million rebate from its 2025-2026 regulatory fees to member firms, due to “higher-than-expected net income, driven largely by regulatory fees associated with record-level trading volumes and firm revenue.”
But the Public Investors Advocate Bar Association condemned the decision, saying the excess fees should have been used to pay unpaid arbitration awards (PIABA estimates about $80 million in FINRA arbitration awards between 2020 and 2024 went unpaid).
According to Michael Bixby, PIABA’s president and a managing attorney with the Florida-based law firm Bixby Law, the decision “tarnishes the reputation of FINRA.”
“Retirement savers and investors who are the victims of misconduct rely on FINRA’s arbitration forum to hold bad actors accountable. That is part of FINRA’s job,” he said. “It’s unconscionable that FINRA has now paid out over $150 million to Wall Street, all while innocent Main Street investors are still waiting for justice and to put their lives back together.”
According to Bixby and FINRA, in 2024, about 37 cents out of every dollar of FINRA arbitration awards to customers went unpaid, and one out of four cases where damages were awarded were not paid (since many investor claims that seem unlikely to be paid are never pursued, PIABA predicts the problem is even harder).
According to FINRA, each qualifying firm will receive a rebate based on its 2025 regulatory fees, including the annual minimum fee of $1,200, with the remaining amount allocated based on last year’s regulatory fees. FINRA plans to send the rebate amount to firms by the end of the month.
A FINRA spokesperson noted that the fee rebate “will not adversely impact our short- or long-term financial planning or ability to perform our regulatory responsibilities,” and argued the member firm’s fee structure “is not designed to address unpaid arbitration awards.”
“FINRA has been focused on this important issue for many years, and our comprehensive report in 2018 reviewed the potential additional measures that could be taken to enhance resources and incentives for paying awards,” the spokesperson said.
Among the suggestions in the 2018 report were SEC rulemaking requiring firms to maintain additional capital, legislation mandating SIPC coverage for unpaid customer arbitration awards, or laws requiring firms to carry insurance to cover such awards, as well as legislation preventing firms from discharging arbitration awards in bankruptcy. FINRA has also required restricted firms to set aside funds to pay arbitration awards.
Last year, FINRA approved a $50 million fee rebate for member firms under similar circumstances, with then-PIABA President Adam Gana saying it was “totally unacceptable” for investors who are victorious in arbitration never to see “a penny of the money nearly one-third of the time.”