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Thursday, December 11, 2014

Whistleblower claim against brokerage belongs in arbitration -court

Dec 9 (Reuters) - A TD Ameritrade Holding Corp employee who said the firm retaliated against him for complaining about potential securities law violations must arbitrate the claim instead of suing in court, a federal appeals court ruled on Monday.
The ruling by the 3rd U.S. Court of Appeals could further weaken U.S. Securities and Exchange Commission rules that carry out procedures required by the 2010 Dodd-Frank financial reform law to protect whistleblowers and curb retaliation against them by employers, lawyers said.
The law created a private cause of action for whistleblowers whose employers retaliate against them for lawfully providing information to the SEC, or making disclosures protected under the Sarbanes-Oxley governance law. But a spate of recent federal court decisions are split about the reach of those protections.
The three-judge panel on Monday ruled that Dodd-Frank did not invalidate an earlier employment agreement between a unit of TD Ameritrade Holding Corp and Boris Khazin, who worked in the firm's compliance group, to arbitrate employment-related disputes through the Financial Industry Regulatory Authority's system.
Employment agreements that brokers and other brokerage employees sign when joining firms typically include so-called "mandatory arbitration" provisions.
The decision hinged on language in Dodd-Frank that makes mandatory arbitration agreements unenforceable with respect to whistleblower claims under the Sarbanes-Oxley Act of 2002, a law...
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