Project 2025 Tracker / What’s done, what’s next

27. Financial Regulatory Agencies · Minor

Require FINRA arbitrators to issue reasoned, reviewable decisions

Not started

836 27. Financial Regulatory Agencies

“Require FINRA arbitrators to make findings of fact based on the evidentiary record and demonstrate how those facts led to the award given (except with respect to very small claims). These written FINRA arbitration decisions should be subject to SEC review and limited judicial review.”

What has happened

  1. Not started

    FINRA arbitrators are still not required to explain an award, and no award is subject to SEC review. The three changes FINRA made to its Codes of Arbitration Procedure inside the window — clarifying arbitrator list selection (approved 2025-08-25), accelerated processing for parties qualifying by age or health condition (approved 2025-08-26), and a further list-selection filing noticed 2026-08-28 — are all about who hears a case and how fast, not about what the decision must say or who may review it. Federal Register full-text searches for "reasoned award" and "explained decision" return zero documents since 2025-01-20, and no 119th-Congress bill addresses the subject. **The baseline is now read as well as the change (read-queue ticket 07, 2026-09-06), and all three limbs of the Quote are absent from FINRA's own rules.** FINRA Rule 12904 says the award "may contain a rationale underlying the award" — permissive, not required. Its explained-decision provision "applies only when all parties jointly request an explained decision", produces "a fact-based award stating the general reason(s) for the arbitrators' decision" for which "[i]nclusion of legal authorities and damage calculations is not required", must be requested by the prehearing document exchange, and does not apply at all to simplified cases decided without a hearing or to default cases. And the rule states that an award is "not subject to review or appeal". So no findings of fact are required, no SEC review exists and no judicial review is contemplated — the position before the window and the position now.

    No action found yet. This entry is the starting point, not a finding.

Research log

What was searched, and what didn’t count as evidence

Research notes

The Quote asks for three things at once — findings of fact, SEC review, and limited judicial review of FINRA awards. None exists and none was proposed.

  • The window’s FINRA arbitration filings are cataloged under #2168. The most recent, https://www.federalregister.gov/documents/2026/08/28/2026-17549/self-regulatory-organizations-financial-industry-regulatory-authority-inc-notice-of-filing-of-a (noticed 2026-08-28), is again about arbitrator list selection.
  • The nearest adjacent movement is on FINRA disciplinary sanctions, not arbitration: after the D.C. Circuit’s 2024 Alpine Securities decision, FINRA filed rule changes to stay the effectiveness of specified expulsions and other actions pending SEC review (2025-10979, 2025-06-17; 2025-11421, 2025-06-23). That is SEC review of a disciplinary sanction, which is a different object from an arbitration award, so it is not counted here.
  • The Investor Choice Act of 2026 (S. 4937, H.R. 9462, both referred 2026-06-24/25) would bar mandatory pre-dispute arbitration clauses altogether rather than require reasoned awards; it is a lead, not progress on this ask, and it has not left committee.
  • Cluster negative search for pages 836–837 is recorded in docs/research/ch-27.md.
  • FINRA’s rulebook was read on 2026-09-06 (read-queue ticket 07), as a lead. finra.org is a private self-regulatory organization and is off the evidence allowlist by design, not by a wall: finra.org/rules-guidance/rulebooks/finra-rules/<number> opens to a bare curl. It also rate-limits hard — four rules read, then HTTP 403 on every request for the next half hour, through three spaced retries. Rules 9261 (Evidence and Procedure in Hearing) and 12904 (Awards) were read in full before that; Rule 9145, which governs attendance at disciplinary hearings, and the FINRA By-Laws provisions on rulemaking were not. Nothing read here is Evidence and none of it changes a Status; it establishes how much of each ask was already true on 2025-01-20, which is what the read-queue row asked for.
  • What Rule 12904 settles: the reasoned-award limb is not a gap in the record, it is a deliberate design choice with a price attached — the panel chairperson receives “an additional honorarium of $400 for writing the explained decision”. That is why nothing in the window moves it: no party to a FINRA arbitration can obtain a reasoned award unless every other party agrees.
Action
other
Object
FINRA arbitration decisions
ID
2169