Investors Sue to Block Arbitration Fees

A group of investors has filed a lawsuit to block a rule that requires customers to pay for an arbitrator to resolve disputes with securities brokers. The investors say the National Assn. of Securities Dealers is violating their right to choose a less expensive procedure by charging them as much as $3,000 a day for an arbitration session. The investors charged that because most securities firms require customers to arbitrate disputes, they often have no choice other than to pay the fees or abandon claims they have against brokers. The lawsuit, filed in a federal court in Washington, seeks to prevent the NASD from charging more than a small administrative fee. The NASD recently asked the Securities and Exchange Commission for permission to increase the fees. An NASD spokesman said the organization hadn’t seen the lawsuit and couldn’t immediately comment.