Expungement Victory For California Advisor With 2021 Termination

After a decade of exemplary service in the financial services industry, this California-based professional sought to clear his CRD and public BrokerCheck® records of a misleading termination disclosure filed by his former firm in 2021, which falsely suggested misconduct and hampered his career. He hired HLBS Law to guide him through the FINRA Dispute Resolution process.

This advisor built a solid reputation over ten years as a registered representative. In June 2021, facing leadership challenges within the firm, the advisor and his advisory team voluntarily resigned to launch an independent practice. Before departing, the advisor emailed client-related information to his personal account—material he believed was permissible to send—unaware of any policy violation. He received no prior warning of an internal review or reprimand during his tenure.

On July 20, 2021, Equitable Advisors filed a Form U5 stating that the advisor had been “permitted to resign” while under review for alleged policy violations—a characterization that the advisor contested as inaccurate and defamatory. The vague, misleading language implied misconduct, despite the advisor’s voluntary exit and lack of intent to breach any rules. This disclosure lingered on his CRD record, severely limiting his ability to secure employment and clients in the competitive financial services field.

The advisor argued the entry was not only false—it was also damaging, as it suggested unethical behavior without evidence. He maintained that his resignation was a planned, team-driven decision, unrelated to any investigation, and that the firm’s reporting was an attempt to tarnish his reputation—possibly to retain his client base.

The advisor filed his Statement of Claim with FINRA Dispute Resolution in October 2024, seeking expungement. Equitable Advisors neither participated in the expungement hearing nor filed a response, effectively conceding to the arbitrator’s ruling. The expungement hearing was held via videoconference in March 2025. Austin Davis, Esq. of HLBS Law presented the advisor’s case, supported by pleadings and testimony.

The FINRA Arbitrator reviewed the evidence and found the Form U5 disclosure to be defamatory in nature. In the award, the Arbitrator ordered that the Reason for Termination on the advisor’s Form U5 be amended to “Voluntary,” the Termination Explanation deleted, and all references to the disputed occurrences expunged from his CRD records. The ruling underscored that the advisor’s actions had involved no customer complaints nor investment-related misconduct, affirming his clean professional conduct.

With this victory, the advisor can soon restore his unblemished record, paving the way to rebuild his career free of the shadow cast by the misleading Form U5 filing.

Facing a similar situation? Contact our team today for a complimentary consultation to evaluate your case. Our experts will assess the viability of expungement and guide you through the process.