The Securities Industry Association has criticized a recently proposed rule by NASD Regulation that would provide NASD members with "qualified immunity" in arbitration proceedings for statements made in good faith on Form U-5, on which a firm is required to file its reasons for termination of a broker.

The SIA has identified the immunity issue as one of its top priorities, and has long pressed the NASD for greater protection for candid statements firms make on U-5s. The trade group says, however, that the current proposal "falls short of what is needed to fix the problem," according to SIA senior v.p. and general counsel Stuart Kaswell.

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