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Re: The NASD Office of the Ombudsman
Chapman, Spira & Carson - Disscusion

From: Robert Spira
Date: 4/2/99
Time: 6:10:16 PM
Remote User:

Comments

Well it must have happened when I wasn't looking. I have been in the brokerage business boy and man for over 45 years and it is a new one on me. I am an arbitrator for the NASD and been a member of New York's NASD District Business Conduct Committee and I never heard of it.

I went over the NASD Web Site to see if that would offer any insight. Believe it or not, there it was big as life.

It seems to me that what they are doing is creating an independent office to sort through all of the complaints that is unaffiliated it the NASD. If there is a standard way of dealing with the problem they will do it, if not they apparently will find a way.

Problems can be handled with or without the dislosure of the complainents identity which may help get rid of some bad brokers.

We have that office here in New York City and I think that it really works and I compliment the NASD for coming up with the idea. There are a lot of interesting things on their web site and we recommend a peek at it. In the meantime for those who want to stay right where they are, we enclose the NASD material for your and our enlightenment. (www.nasd.com)

[ NASD ]

About The Office Fair And Confidential Assistance

Ombudsman’s Purview

History Of The Ombudsman

Complementing Existing Efforts

Contacting The Ombudsman

Questions & Answers

Who We Are

Who We Serve

Pointing The Way To Fair And Effective Solutions

-------------------------------------------------------------------------------- The National Association of Securities Dealers, Inc. (NASD®) created the Office of the Ombudsman in response to the recommendation made by the NASD Select Committee on Structure and Governance that an independent office be established to receive and address “concerns and complaints, whether anonymous or not, from any source (within or outside of the NASD) concerning the operations, enforcement, or other activities of the NASD, NASD RegulationSM, or Nasdaq®, or any staff members.”

In July 1996, just months after the recommendation was made, the Office was established and Bernard Thompson was named NASD Ombudsman. As of September 1998, the Ombudsman staff also includes Patrice Anderson, Dave Bradford, Theresa Lucas, and Mariann Miller.

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Fair And Confidential Assistance

If you have a problem that involves the NASD or its subsidiaries, the Ombudsman is available to help you in three principal, and very important, ways:

First, by helping you identify, understand, and evaluate the options that exist and are available to remedy your problem or address your concern. Second, by suggesting actions and policies that ensure these avenues are functioning properly and equitably. Third, by taking objective action to resolve matters that fall outside the established forums and procedures.

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Ombudsman’s Purview

The Office of the Ombudsman will receive and review complaints in a variety of areas. If it is determined that there is no existing procedure or channel for pursuing the matter, the Ombudsman will conduct an informal investigation and recommend appropriate actions, if warranted. Matters that may be reviewed by the Ombudsman include:

Inconsistent or biased decisions by NASD staff, or those that result in disparate treatment. Reported weaknesses in NASD controls, practices, or procedures—especially when the person complaining feels he or she cannot report them to NASD management. Complaints based on discretionary acts by the NASD staff for which an established appellate channel does not exist.

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History Of The Ombudsman

The word “ombudsman” comes from the Old Norse word “umbodhsmadhr.” In Swedish it means “a trusted commissioner or agent who looks after the interests or legal affairs of a group or business.” Today, in many Scandinavian countries, the ombudsman is a government official who investigates citizens’ complaints against the government.

The concept of the ombudsman [om´–budz–man], as well as the term, has been adopted in many other countries and has been expanded beyond government agencies to be used in a corresponding manner in businesses and organizations.

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Complementing Existing Efforts

The Office of the Ombudsman was created as an enhancement to the NASD’s comprehensive program of adjudication, dispute resolution, and internal review. Where established procedures currently exist regarding the application of rules, policies, procedures, or interpretations, the Ombudsman will direct the complaint to the appropriate office, department, or organization. The function of this Office is not intended to be an appeals forum for unpopular decisions made in other forums or an arbitrary alternative to the program that already exists.

The Ombudsman will always assist you in identifying the appropriate method of resolving your problem or complaint, even if the Ombudsman’s Office does not become directly involved in the matter.

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Contacting The Ombudsman

You can call the Office of the Ombudsman at (301) 212-2515 or toll-free at (888) 700-0028, weekdays from 9 a.m. - 5 p.m. (Eastern Time). If you call outside of normal business hours, you may leave a confidential voice mail message and someone will return your call as soon as possible.

If you prefer, you can write or visit the Office of the Ombudsman in its new location. The address is: NASD Ombudsman, P.O. Box 9492 Gaithersburg, MD 20898-9492, or send your e-mail message to: ombuds@nasd.com.

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Questions & Answers

Q. Who may contact the Ombudsman? A. Anyone with a complaint or concern regarding the NASD, NASD Regulation, or The Nasdaq Stock MarketSM. This would include investors, securities industry professionals, employees of these organizations, and any business or individual who interacts with these organizations.

Q. What types of problems does the Ombudsman handle? A. Any concerns or complaints about the operations, enforcement, or other activities of the NASD, NASD Regulation, and The Nasdaq Stock Market, or their staff members. If you’re not sure that your problems fit in this category, call us to find out!

Q. If I complain to the Ombudsman, who will find out about it? A. Your consultation with the Ombudsman is absolutely confidential. In fact, your complaint or concern may be made anonymously, if you prefer.

Q. Who pays for this service? A. The NASD and its subsidiaries provide and pay for this service for all matters concerning the NASD, NASD Regulation, and The Nasdaq Stock Market. There’s even a toll free number, (888) 700-0028, that you may use to call us.

Q. Is the Ombudsman a person or a department? A. The Ombudsman is an individual who is appointed to this Office. The Ombudsman will direct his staff (which continues to grow and evolve as the program develops) in carrying out the responsibilities of the Office of the Ombudsman.

Q. Does the Ombudsman have authority to solve every problem? A. No, that’s not the purpose of this Office. The securities industry, the NASD, and its subsidiaries already have many programs and procedures in place for solving problems, resolving disputes, handling complaints, and addressing concerns. The Ombudsman will help you identify the right avenue, make sure it’s available to you, and help you use it most effectively.

Q. What if my complaint is about one of the programs or procedures that’s supposed to be handling my problem? A. In that case, the Ombudsman can and will take the steps necessary to ensure that the structure and procedure of the existing forums are operating properly, appropriately, and equitably. However, it is not the Ombudsman’s job to overturn decisions made in these forums.

Q. Is that the only time the Ombudsman will get involved directly? A. No. The Ombudsman will act to resolve any matter that falls outside the established forums. Additionally, the Ombudsman will be actively involved in helping you evaluate your options for resolving the matter and making sure that you are fully informed.

Q. If you interview someone, will that person automatically be informed of the final disposition of the matter? A. As a matter of procedure, the Ombudsman will automatically inform the individual (who raised the issue) of the investigation's outcome. However, should an individual interviewed during the investigation call about it, the Ombudsman will provide general information on the outcome and, without getting into specific details, the general recommendations that were forwarded to management. (11/97)

Q. When should I refer someone to the Ombudsman? A. If you convey your understanding of a policy or procedure to an individual and he or she is still concerned, you may refer him or her to the Ombudsman. If your understanding was accurate, the Ombudsman will reinforce your information on the policy or procedure to the individual. This approach usually settles the controversy because identical answers from a neutral third party, such as the Ombudsman, frequently provide individuals with a new perspective that enables them to understand and, often, accept the explanation. (1/98)

Q. Should I handle customer complaints referred from the Executive Office? A. Yes. If you are responsible for responding to customer complaints, you must do so regardless of where they originate. You may contact the Ombudsman about the situation, but you are not required to do so. If the customer remains concerned about the fairness of the process after you have fulfilled your responsibilities, you can refer him or her to the Ombudsman. (1/98)

Q. Can we get a report of your findings on a matter? A. Given the highly sensitive nature of its work and the Office's standing guarantee of confidentiality, the Ombudsman very rarely issues reports of findings. In fact, most of the Ombudsman's business is conducted and settled by phone and in meetings. (1/98)

Q. How can we know what the issues and outcome are? A. Unless you are directly involved in the case, often you will not know specifically what the Ombudsman is reviewing. It will depend on the specific issue, your involvement, the process or procedure affected, and whether changes are needed. Recommendations for changes can range from suggestions made during an interview with someone to actual initiatives for changing a process or procedure. Before recommending a change, the Ombudsman will address the pros and cons of its action. (1/98)

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Who We Are

Bernard Thompson, Vice President, Ombudsman--Before being appointed Ombudsman, Bernard served as an Assistant Director of Member and Market Services in Market Regulation. Bernard joined the NASD in 1977 as an Examiner in the Washington, DC office and has risen steadily through the organization.

Dave Bradford, Associate Director, Ombudsman--While the Office was being created, Dave performed Ombudsman duties in addition to other functions for the Internal Review Department. Dave joined the NASD in 1981 and over his 17-year career, has worked as a Senior Analyst in the CRD and Market Regulation Departments of NASD Regulation, and as a Coordinating Analyst with The Nasdaq Stock Market.

Theresa Lucas, Administrative Assistant-- Before joining the Office of the Ombudsman, Theresa served a little over two years in the District 9 office of NASD Regulation as a receptionist/clerk typist. One of Theresa's primary responsibilities was to assist the examining staff and a regional attorney with various assignments and projects. Before joining the NASD in 1994, Theresa was employed with Ernst & Young.

Mariann Miller, Associate Director, Ombudsman--Before becoming an Ombudsman, Mariann spent the previous six years in Market Regulation as a Team Leader in the Trading and Market Making Surveillance Unit. Before joining the NASD, Mariann was a Compliance Officer for a mid-sized member firm in Bethesda, Maryland.

Patrice Anderson, Investigator III, Ombudsman—Joined the NASD in 1989 and has over 18 years of combined managerial, training, and organizational development experience in the financial and securities industries. Within the NASD, Patrice has experience in the areas of regulation, performance management, diversity, management and staff development, and employee relations.

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Who We Serve

Employees of the NASD, NASDR, and Nasdaq Investors Registered and Associated Persons of Broker/Dealer Firms Nasdaq and Bulletin Board Issuers And Others NASD Ombudsman P.O. Box 9492 Gaithersburg, MD 20898-9492

(301) 212-2515 • (888) 700-0028


Last changed: September 26, 1999