Deleting misconduct: The expungement of BrokerCheck records

We examine a controversial process, known as expungement, which allows brokers to remove evidence of financial misconduct from public records. From 2007 2016, we identify 6660 expungement requests, suggesting that attempt expunge 12% the allegations reported by customers and firms. When these requests are adjudicated on merits, arbitrators approve 84% time. show expungements significantly predict future misconduct; with prior 3.3 times likely engage in new average broker. Further, using an instrumental variable based random assignment arbitrators, present who receive more reoffend than denied expungement. also successful improve long-term career prospects.