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Filings up 24% over 2000

NASD STATS, 4/01: NASD Dispute Resolution reported a 24% growth in new filings through April 2001.

The comparison is to the same period in 2000, when 1,616 claims were filed. Y2K, in terms of arbitration filings, was an average year, relative to those in the latter half of the 90’s. If, however, the pace of claims filed during the first four months of 2001 continues, 2001 will be anything but average! The 2,137 claims filed through April 2001 annualizes to 6,411 filings, which would be the highest number of annual submissions in NASD arbitration history.

The new influx presents a challenge for NASD-DR, which was able last year to close almost as many cases as it opened. The 1,616 close-outs compares adequately to the 1,697 close-outs achieved last year at this time, but it lags by about 500 the number of new and incoming cases.

Methods of expediting processing include transfer to the SICA Non-SRO Pilot, voluntary use of the Single Arbitrator Pilot, and agreement to Mediation. Among 94 eligible cases, only 3 have opted for the Non-SRO Pilot to date. Four cases are being processed under the Single Arbitrator Pilot, but 332 cases have been defined as eligible.

Mediation is active, but shows signs of slowing as the “Percent Settled” has dropped to 75% and new cases entering mediation are down about 8% from last year. According to the NASD’s close-out classifications, the percentage of settling cases resolved through mediation (vs. directly) will, if the current numbers hold through 2001, fall below 20% for the first time since 1997. “Margin Calls” and “Online Trading” will account for more than 10% of the new caseload this year, if trends continue, and that is significantly more than in the most recent two years.

Through April, the “win” rate for investors who try their cases through decision is approximately 55%, not significantly different from the 53% “win” rate for all customer Awards in 2000.


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Nothing herein is intended as legal or financial advice. The law is different in different jurisdictions, and the facts of a particular matter can change the application of the law. Please consult an attorney or your financial advisor before acting upon the information contained in this article. 


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