Arbitrator Update

 

ArbitratorUpdate


 

July 2011 Issue

Table of Contents:

Arbitrator Profile: Deb Buzick

Amendments to Section 10(g) of NFA's Code of Arbitration/Member Rules

Amendments to Section 8(a) of NFA's Code of Arbitration

Chairperson Online Education Program

Securities Arbitration and Mediation Hot Topics 2011

Paul Bates

Deb Buzick

Deb Buzick

Each time we publish the Arbitrator Update, we write an article featuring one of our arbitrators. This time we have chosen to highlight Deb Buzick, a knowledgeable industry arbitrator from our California roster.

Arbitrator Profile: Deb Buzick

From the time Deb Buzick was a young girl she knew she wanted to work in the commodities industry. Her father was a farmer who taught Deb the hedging principles most farmers rely on. Deb was intrigued by these principles as well as the exchanges between her father and his commodity broker.

Needless to say, Deb realized her dream in 1977 when she graduated from the University of Memphis with a B.A. in Finance. At that time, Deb applied to be a commodity broker at Merrill, Lynch, Pierce, Fenner and Smith (MLPFS), but was met with some resistance. Deb's dad encouraged her to stand her ground and follow her dream. She persevered and was hired as a commodity sales assistant. Three and a half years later Deb obtained her Series 3 and became the very first woman commodity account executive in the Memphis office!

In total, Deb spent 16 years as a commodity broker. In 1986, she moved to Minneapolis where she spent several years working for an Introducing Broker (IB). While at the IB, she only had a few other women commodity brokers to collaborate with since it was predominantly a male industry at that time. Having endured 10 years of Minnesota winters, Deb rejoined MLPFS as a Branch Manager in 1996 and moved to the beautiful state of California. From there, she transitioned into the Compliance arena in 2004. She currently manages a team of nine individuals and together they provide advice and guidance to various lines of business within MLPFS. In addition to her Series 3, Deb now holds the series 7, 9, 10, 30, and 63.

Due to her extensive commodity background, NFA's Arbitration Department contacted Deb in 1996 to see if she would like to join our arbitrator roster. She agreed to be a part of our program and immediately served on her first panel. Deb takes her participation very seriously because in her words, "It's important for every claimant and respondent to have someone on their panel who completely understands the business." This can be challenging given the changing nature of the business which requires panelists to have broader market and industry knowledge than ever before, but Deb tackles this challenge head on.

When asked what she finds most rewarding about being an arbitrator, she responds unequivocally, "Discussing with my panel members the facts presented and arriving at what we are confident is the correct decision." She finds she is now more accepting of differing views and believes that being an arbitrator on a three-person panel is a contributing factor.

When asked what advice Deb would give first-time arbitrators, she says with enthusiasm "Do your homework! Make sure you understand the facts of the case as presented by both sides and review any relevant market information you may be a little rusty on. Have your questions ready and leverage the experience/expertise of your 2 panel members and remember – you have two ears and one mouth!" Reflecting on her years as an arbitrator, Deb strongly believes that being involved in the arbitration process is a way to give back for the great career that the industry has provided her.

It's not all work and no play for Deb, however. In her free time Deb enjoys playing golf, traveling (she is currently in Paris!), reading and mostly just enjoying her many amazing friends.

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Amendments to Section 10(g) of NFA's Code of Arbitration/Member Rules

When an NFA Member or Associate fails to pay an arbitration Award or comply with the terms of a settlement agreement, NFA's President may summarily suspend the Member or Associate until the Award or settlement agreement has been satisfied. In the past, however, when a former Member or Associate failed to satisfy an Award or comply with the terms of a settlement agreement, NFA's only recourse was to update the former Member's or Associate's registration record to reflect the failure to pay. Unfortunately, this failure alone did not constitute grounds to deny NFA Membership to the firm or individual if they chose to reapply in the future.

As a means of resolving this problem, NFA amended Section 10 of the Code and the Rules. Section 10 now provides that NFA's President may summarily bar from membership a former Member or Associate if that firm or individual fails to satisfy an Award or comply with the terms of a settlement agreement. The bar will remain in effect until the Award is paid or the settlement agreement has been satisfied. This amendment is effective for all arbitration cases pending on or after July 7, 2011.

NFA also made a technical amendment to Section 10(g)(1)(iii) of the Code and the Rules. This section previously provided that NFA's President may suspend a Member or Associate for failure to comply with a settlement agreement executed in connection with an NFA-sponsored pre-arbitration mediation proceeding. Since NFA no longer offers a pre-arbitration mediation program, this section of the Code and Rules is no longer necessary.

For additional information on the proposed amendment, please see http://www.nfa.futures.org/news/PDF/CFTC/ArbCodeSec10ArbRulesSec10_022211.pdf

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Amendments to Section 8(a) of NFA's Code of Arbitration

The CFTC recently approved certain amendments relating to a party's obligation to automatically exchange specified documents in connection with an NFA arbitration proceeding. Section 8(a) of NFA's Code of Arbitration requires all that all parties in an NFA arbitration proceeding automatically exchange certain documents that NFA has identified as routinely relevant for the cause of action alleged in a particular case.

When NFA’s Board originally approved the list of relevant documents, NFA did not have jurisdiction over disputes that involved forex transactions. Although many of the documents included on the list are relevant regardless of whether the dispute involves on-exchange futures or forex transactions, NFA’s Board recently identified a few additional documents that may be routinely relevant in certain disputes involving forex transactions. These documents (i.e. communications sent/received regarding price adjustments or system difficulties and the firm's procedures regarding their electronic trading systems) have been added to the standard list which can be found at http://www.nfa.futures.org/nfamanual/NFAManual.aspx?RuleID=9031&Section=9.

The amendments to Section 8(a) are effective for all customer claims filed on or after April 15, 2011.

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Chairperson Online Education Program

As many of you may know, NFA offers two online training programs to help you satisfy your mandatory training requirement to serve as an NFA arbitrator. Later this summer NFA will introduce a third training module which focuses on the duties and responsibilities of a panel Chairperson. It may take up to 15 minutes to complete the Chairperson Education Program; however, we will offer you periodic opportunities to save your progress, so you may return at any time to finish the program.

This program is designed as a supplement to "An Online Learning Program for NFA Arbitrators" and "What to expect During a Pre-Hearing Conference Call". If you have not yet taken these programs, we encourage you to do so before beginning this one. You may access the modules at http://www.nfa.futures.org/NFA-arbitration-mediation/online-training.HTML.

As always, we welcome any comments or feedback you might have on the Chairperson module or any other training module you have used. Please remember that in order to remain eligible to serve as an arbitrator, you are required to complete a training program at least once every three years – and any of these modules can be used to satisfy this requirement.

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Securities Arbitration and Mediation Hot Topics 2011

On June 8, 2011, a premiere faculty of experienced practitioners gathered together to examine recent developments in the area of securities arbitration and mediation. Our own Christine Roche, Manager of Arbitration, was selected to be on that panel to provide an overview of NFA's Arbitration Forum. The Hot Topics program examined rule changes, decisions and events in the industry and delivered practical suggestions on prosecuting and defending securities arbitration claims. This program, which is held annually at the NY City Bar, satisfies our mandatory training requirement and enables participants to earn CLE credit.

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Paul Bates

Our condolences go out to the family of Paul Bates, a long time NFA arbitrator and friend. Paul passed away on February 8, 2011, at the age of 81 years old. He was the owner and manager of Bates Commodities for 35 years and was extremely involved in his community. Paul will be missed by everyone who knew him.

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