Imagine you’re a stockbroker who’s dedicated years to building your career. You’ve worked hard to earn your clients’ trust, and you’ve always strived to do what’s right. But then, out of nowhere, you find yourself facing a Form U5 disclosure. Maybe it was a wrongful termination, or perhaps a misunderstanding led to a mark on your record. Whatever the reason, that disclosure is now a dark cloud hanging over your professional life.
You know that this disclosure isn’t just a minor inconvenience—it’s a career killer. Every time a potential employer or client looks you up on BrokerCheck, they see that mark, and it raises questions. It makes them hesitate. It makes them wonder if they can trust you. And in an industry where trust is everything, that’s a problem you can’t afford to ignore.
But here’s the thing: you don’t have to let that disclosure define you. There is a way to fight back, to clear your name, and to take control of your career again. It’s called expungement, a process that can remove that wrongful mark from your record. However, it’s not easy. Expunging a Form U5 disclosure comes with its own set of challenges, and it’s not something you should try to navigate alone.
That’s where we come in. At Bakhtiari & Harrison, we’ve helped countless brokers like you expunge disclosures and reclaim their reputations. We know the FINRA arbitration process inside and out, and we’re here to guide you every step of the way.
In this blog post, we’ll walk you through the challenges of expunging a Form U5 disclosure and share strategies to help you succeed. We’ll also explain why having an experienced U5 disclosure attorney on your side is crucial to winning your case.
So, if you’re ready to take the first step toward clearing your record, keep reading. Your future is too important to leave to chance.
Why a Form U5 Disclosure Is a Career Killer
For those who may not be familiar, a Form U5 is a document that brokerage firms are required to file with FINRA when a broker leaves the firm, whether voluntarily or involuntarily. This form includes a section where the firm must disclose the reason for the broker’s departure. If the firm alleges misconduct—such as a violation of industry rules, fraud, or even something as vague as “other”—that information becomes part of your permanent record.
Once that disclosure is on your record, it’s visible to the public through FINRA’s BrokerCheck system. That means anyone—potential employers, clients, even competitors—can see it. And in an industry where reputation is everything, a negative disclosure can be devastating.
Here are just a few ways a Form U5 disclosure can impact your career:
- Job Prospects: When you’re looking for a new position, the first thing a potential employer will do is check your BrokerCheck report. If they see a disclosure, especially one that suggests misconduct, they may decide to pass on your application without even giving you a chance to explain.
- Client Trust: Existing clients or prospects may also look you up on BrokerCheck. If they see a disclosure, it can raise doubts about your integrity and professionalism, leading them to take their business elsewhere.
- Regulatory Scrutiny: A disclosure can also attract unwanted attention from regulators, making it more likely that you’ll face additional audits or investigations in the future.
- Emotional Toll: Beyond the professional consequences, there’s also the emotional weight of knowing your reputation has been tarnished. It’s stressful, frustrating, and can make you feel like you’re fighting an uphill battle.
The bottom line is that a Form U5 disclosure isn’t just a minor setback—it’s a major obstacle that can derail your career if you don’t address it.
But here’s the good news: you don’t have to accept it as a permanent stain on your record. Through the process of expungement, you can fight to have that disclosure removed. However, expungement is not automatic, and it’s not easy. It requires navigating the complex world of FINRA arbitration, and that’s where many brokers hit a wall.
Why You Need an Experienced U5 Disclosure Attorney
At Bakhtiari & Harrison, we understand how overwhelming and intimidating the expungement process can feel. You’ve already been through the stress of a wrongful termination or a false allegation, and now you’re faced with the daunting task of clearing your name through FINRA arbitration. It’s a lot to handle, especially when your career is on the line.
That’s why we’re here to help. Our team of experienced securities attorneys has a proven track record of successfully expunging Form U5 disclosures for brokers just like you. We know the ins and outs of FINRA’s rules and procedures, and we’ve developed strategies that work.
Here are a few reasons why having an experienced U5 disclosure attorney is crucial to your success:
- Expertise in FINRA Arbitration: Expungement cases are handled through FINRA arbitration, which is a unique and complex process. Our attorneys have years of experience navigating this system and know how to present your case in the most compelling way.
- Understanding of FINRA Rule 2080: To expunge a customer-related disclosure, you must prove that it meets one of the criteria under FINRA Rule 2080, such as being factually impossible, clearly erroneous, or false. We know how to build a strong case that meets these standards.
- Negotiation Skills: In some cases, we can negotiate with your former firm to amend the Form U5 before going to arbitration, potentially saving you time and money.
- Court Confirmation: Even after winning, you need to get a customer-related award confirmed in court to make the expungement official. We handle that process for you, ensuring all the necessary steps are taken.
But don’t just take our word for it. Here’s what one of our clients had to say after we helped them expunge a wrongful termination disclosure:
“I was at my wit’s end. The disclosure on my record was costing me job opportunities, and I didn’t know where to turn. Bakhtiari & Harrison took the time to understand my situation, and they fought for me every step of the way. Thanks to them, my record is clean, and I can finally move forward with my career.”
If you’re ready to take control of your future, we’re here to guide you through the process.
How to Expunge a Form U5 Disclosure
Expunging a Form U5 disclosure is a multi-step process that requires careful planning and execution. Below, we’ll walk you through each step, highlighting your challenges and strategies to help you overcome them.
Step 1: Determine If Your Case Qualifies for Expungement
Before beginning a customer-related expungement process, you must determine whether your case meets the criteria under FINRA Rule 2080. According to this rule, a disclosure can be expunged if it is:
- Factually impossible or clearly erroneous
- False
- Not related to a sales practice violation (for customer disputes)
- Or if you were not involved in the alleged misconduct
Proving that your disclosure meets one of these criteria can be difficult, especially if the firm follows its original statement.
Gather as much evidence as possible to support your case. This could include emails, performance reviews, client testimonials, or any other documentation contradicting the firm’s allegations. An experienced attorney can help you identify the strongest evidence and build a compelling argument.
Step 2: File an Expungement Request
You must file a “straight-in” expungement request under FINRA Rule 13805. This means you’re initiating arbitration solely for expungement.
You’ll need to name a respondent in the arbitration, which is typically your former firm. However, the firm may resist or contest the expungement, especially if they believe the disclosure is accurate.
Your attorney can help you craft a strong Statement of Claim outlining why the disclosure should be expunged. In some cases, we may negotiate with the firm beforehand to see if they’re willing to amend the Form U5 without going to arbitration.
Step 3: Prepare for the Arbitration Hearing
Once your request is filed, you’ll need to prepare for the arbitration hearing. This involves presenting your case to a panel of arbitrators who will decide whether to grant the expungement.
Arbitration can be unpredictable, and the outcome depends on how well you present your case. You’ll need to be thoroughly prepared and anticipate any arguments the firm might make.
Work closely with your attorney to develop a clear and persuasive narrative. Practice your testimony, and make sure all your evidence is organized and ready to present. Your attorney will also handle any procedural issues and ensure that the arbitration process runs smoothly.
Step 4: Obtain a Favorable Arbitration Award
If the arbitrators rule in your favor, they’ll issue an award recommending expungement. However, this is just the first step—you’ll still need to get the award confirmed in court.
Even with a favorable award, the firm or FINRA may oppose the expungement in court, especially if they believe it sets a bad precedent.
Your attorney will handle the court confirmation process, presenting the arbitration award and any additional evidence to the judge. We’ll also be prepared to counter any objections from the firm or FINRA.
Step 5: Get the Expungement Confirmed in Court
Once the court confirms the arbitration award, the expungement becomes official, and FINRA will remove the disclosure from your record.
Court confirmation can take time, and there’s always a chance that the judge could deny the request, although this is rare.
Working with an experienced attorney ensures that all the necessary paperwork is filed correctly and that your case is presented in the best possible light.
Don’t Face This Alone—Contact Bakhtiari & Harrison Today
If you’re a stockbroker with a Form U5 disclosure on your record, you don’t have to let it define your career. Expungement is possible, but it’s not something you should try to handle on your own. The process is complex, and the stakes are high.
At Bakhtiari & Harrison, we’re here to help. Our team of experienced U5 disclosure attorneys has a proven track record of success in FINRA arbitration and expungement cases. We’ll guide you through every step of the process, from filing your request to getting the expungement confirmed in court.
Don’t wait—every day that disclosure stays on your record is another day it could be holding you back. Contact us today for a free consultation, and let’s start working on clearing your name.
What Life Looks Like After Expungement
Imagine waking up one morning, checking your BrokerCheck report, and seeing that the disclosure is gone. It’s like a weight has been lifted off your shoulders. You can finally move forward with your career without that dark cloud hanging over you.
Here’s what success looks like:
- New Job Opportunities: With a clean record, you’re free to pursue new positions without the fear of being rejected because of a disclosure. Employers will see you for your skills and experience, not for a mark on your record.
- Restored Reputation: Your clients and colleagues will know that you’ve fought to clear your name, and that speaks volumes about your integrity and determination.
- Peace of Mind: No more worrying about what people think when they look you up on BrokerCheck. You can focus on what you do best—serving your clients and growing your business.
Expungement isn’t just about removing a disclosure—it’s about reclaiming your future.
What Happens If You Don’t Take Action
If you choose not to pursue expungement, that disclosure will remain on your record indefinitely. That means:
- Continued Career Stagnation: You may find it difficult to advance in your career or find new opportunities, as potential employers will always see that mark.
- Ongoing Stress: Knowing that your reputation is tarnished can affect your mental health and overall well-being.
- Missed Opportunities: Every time a client or employer looks you up on BrokerCheck and sees that disclosure, it’s a missed opportunity to build trust and grow your business.
Don’t let a wrongful disclosure define your career. Take action today and start the process of clearing your name.
Frequently Asked Questions (FAQs)
To provide further clarity, here are some common questions brokers have about expunging Form U5 disclosures:
1. How long does the expungement process take?
The timeline can vary, but typically, the arbitration process takes 6 to 12 months, followed by court confirmation, which can take an additional few months. An experienced attorney can help expedite the process where possible.
2. What are the costs involved in expunging a Form U5 disclosure?
Costs include arbitration filing fees, attorney fees, and court costs. While it can be an investment, the long-term benefits of a clean record often outweigh the expenses. We offer free consultations to discuss your case and provide a clear estimate.
3. Can I expunge a disclosure if I was terminated for cause?
Yes, even if you were terminated for cause, you can still pursue expungement if you can prove that the disclosure is false, erroneous, or meets other FINRA Rule 2080 criteria. Each case is unique, so it’s important to consult with an attorney.
4. What if my former firm opposes the expungement?
Opposition from your former firm is common, but it’s not insurmountable. You can still succeed in arbitration and court confirmation with a strong case and the right legal strategy.
Expunging a Form U5 disclosure is a challenging but achievable goal. With the right strategies and an experienced U5 disclosure attorney by your side, you can clear your record and take back control of your career. At Bakhtiari & Harrison, we’re committed to helping brokers like you navigate the FINRA arbitration process and achieve the justice you deserve.
Don’t let a wrongful disclosure hold you back any longer. Contact us today to schedule your free consultation and start your journey toward expungement.