Table of Contents
SERIES 24 | FINANCIAL REGULATION COURSES
FINRA Rule 9150 establishes the authority of Adjudicators to exclude attorneys and authorized representatives from Code of Procedure proceedings and confirms the important limiting principle that such exclusion does not prevent FINRA from bringing separate proceedings against the excluded person. The rule provides in paragraph (a) that an Adjudicator may exclude an attorney for a party or other person authorized to represent others under FINRA Rule 9141 from acting as counsel, acting in any representative capacity, or otherwise appearing in a particular Rule 9000 series proceeding for contemptuous conduct under FINRA Rule 9280 or unethical or improper professional conduct in that proceeding — and that an excluded attorney or representative may seek review of the exclusion by the National Adjudicatory Council under FINRA Rule 9280(c). Paragraph (b) confirms that prohibiting an attorney or representative from practicing or appearing in a FINRA proceeding does not preclude FINRA from initiating other proceedings against that person.
FINRA Rule 9150 sits within the 9140 Proceedings subsection of the 9100 Application and Purpose section of the 9000 Code of Procedure series. It was adopted by SR-NASD-97-28 effective August 7, 1997, amended by SR-NASD-97-81 effective January 16, 1998, and last amended by SR-FINRA-2008-021 effective December 15, 2008 as part of the consolidated FINRA rulebook transition announced in Regulatory Notice 08-57. The rule has not been substantively amended since 2008. One selected notice is associated with the rule — Regulatory Notice 08-57.
FINRA Rule 9150(a) grants Adjudicators discretionary authority — the word may rather than shall — to exclude attorneys and representatives on two distinct grounds. Understanding each ground separately is essential to applying the rule correctly.
The first ground — contemptuous conduct under FINRA Rule 9280 — is defined by cross-reference to FINRA Rule 9280's contemptuous conduct framework. FINRA Rule 9280 provides that if a party, attorney for a party, or other authorized representative engages in conduct in violation of a Hearing Officer, Hearing Panel, or Extended Hearing Panel order, or other contemptuous conduct during a proceeding, the Hearing Officer or Panel may both impose sanctions under FINRA Rule 9280(b) and exclude the attorney or representative under FINRA Rule 9150. The contemptuous conduct ground thus encompasses two categories: direct violation of Adjudicator orders, and the broader category of contumacious behavior that disrupts or obstructs the orderly conduct of proceedings — behavior analogous to what courts would treat as contempt of court.
OHO Order 98-14 confirmed that FINRA Rule 9280 was enacted to discipline parties or counsel on either side who engage in frivolous practice or contumacious conduct — confirming that the contemptuous conduct standard reaches both substantive disruption and procedural obstruction that undermines the Adjudicator's ability to manage the proceeding. Conduct that falls within this ground might include repeated defiance of Adjudicator rulings, deliberate disruption of hearing sessions, bad faith delay tactics, or any other behavior that treats the adjudicative process with contempt.
The second ground — unethical or improper professional conduct in that proceeding — is a distinct and independently operating basis for exclusion that does not require conduct rising to the level of contempt. Unethical professional conduct is assessed against the professional responsibility rules that govern attorneys — the applicable state bar rules of professional conduct and the Model Rules of Professional Conduct that most state rules follow. Improper professional conduct is a somewhat broader standard that may reach conduct falling short of a formal ethics violation but that is nevertheless incompatible with the standards of professional practice expected in formal regulatory proceedings. OHO Order 98-14 confirmed that OHO draws heavily on judicial decisions concerning attorney disqualification when applying this standard — treating FINRA Rule 9150 exclusion proceedings as analogous to judicial attorney disqualification motions, with the same tension between the seriousness of the alleged professional misconduct and the party's right to representation by counsel of their choosing.
A critical constraint in FINRA Rule 9150(a) is the phrase in a particular Rule 9000 series proceeding. The exclusion authority is proceeding-specific — an Adjudicator may exclude a representative from the specific proceeding before them, not from all FINRA proceedings generally. A Hearing Officer who excludes a respondent's attorney from a disciplinary proceeding for contemptuous conduct in that proceeding has not barred that attorney from representing other clients in other FINRA proceedings, or even from representing the same client in future proceedings not yet initiated. The exclusion is a remedy tailored to the specific proceeding in which the conduct occurred.
This limitation is practically significant for two reasons. First, it confirms that FINRA Rule 9150 exclusion is a remedial measure designed to protect the integrity of the specific proceeding rather than a generalized disciplinary sanction against the attorney's right to practice before FINRA. Second, it means that exclusion from one proceeding does not automatically carry over — each proceeding must stand on its own facts if FINRA Rule 9150 exclusion is sought in a new matter. The generalized disciplinary authority over attorneys who practice before FINRA — including the authority to bar an attorney from all FINRA proceedings — is a separate matter governed by other FINRA rules and disciplinary processes rather than FINRA Rule 9150's proceeding-specific exclusion authority.
FINRA Rule 9150(a)'s provision that an excluded attorney or representative may seek review by the NAC under FINRA Rule 9280(c) is the specific exception to FINRA Rule 9148's general prohibition on interlocutory review — and the only category of as-of-right interlocutory review in the entire Code. FINRA Rule 9280(c) provides the detailed procedural framework for this NAC review, including the automatic stay of the disciplinary hearing pending the review and the adjournment provisions that apply when the NAC upholds the exclusion and the party must find new counsel.
The as-of-right nature of NAC review for exclusion orders reflects the serious and immediate practical consequences of attorney exclusion. A respondent whose attorney is excluded from a hearing in progress faces an immediate crisis — the proceeding will continue, testimony will be taken, and the case will advance without the attorney whose assistance the respondent has retained and relied upon. Requiring the excluded attorney and client to continue through the entire proceeding and only then seek appellate review would effectively moot the review — by the time an appeal could be heard after a final decision, the harm from the exclusion would be complete and irreversible. The immediate NAC review right, combined with the automatic stay of proceedings pending that review, preserves the meaningful ability to challenge an exclusion order before its consequences become irreversible.
FINRA Rule 9280(c) establishes that when an excluded attorney seeks NAC review, the hearing, conferences, and other activities relating to the disciplinary proceeding shall be stayed pending the review. The NAC or its Review Subcommittee conducts the review and either upholds or reverses the exclusion. If the exclusion is upheld, the Hearing Officer may grant an adjournment on motion by the affected party to allow retention of new counsel — considering factors such as whether other counsel of record are available, the availability of members of the excluded attorney's firm, and other relevant circumstances. If the exclusion is reversed, the attorney is reinstated and the proceeding resumes with them as counsel.
The unethical or improper professional conduct ground for exclusion under FINRA Rule 9150(a) draws on the rich body of judicial authority on attorney disqualification in civil litigation — the cases in which courts have excluded attorneys from proceedings based on conflicts of interest, improper communications, misrepresentations to the tribunal, or other conduct incompatible with the professional standards that courts expect. OHO Order 98-14 confirmed that OHO applies judicial disqualification standards when assessing motions under FINRA Rule 9150, treating the rule's professional conduct standard as the FINRA analog to the standards courts apply in federal disqualification proceedings.
The tension that runs through judicial attorney disqualification cases — between vindicating professional conduct norms and protecting the party's constitutionally-grounded right to counsel of their choosing — applies equally in the FINRA context. OHO Order 98-14 specifically noted that the power to exclude will inevitably cause delay and interfere with a party's right to be represented by counsel of their own choosing, signaling that exclusion is a serious remedy that must be carefully weighed against these competing interests. Adjudicators in FINRA proceedings approach exclusion motions on professional conduct grounds with appropriate caution — not every arguable ethical lapse justifies exclusion, and the exclusion power is reserved for situations where the professional misconduct is sufficiently serious and directly related to the conduct of the proceeding that remedies short of exclusion would be inadequate.
Common situations that have been raised as grounds for FINRA Rule 9150 professional conduct exclusions include conflicts of interest arising from prior representation of adverse parties, possession of confidential information obtained from previous representation that could be used against a former client in the current proceeding, impersonation of a party's interest where the actual attorney-client relationship is disputed, and conduct in the current proceeding that violates specific professional responsibility obligations such as the prohibition on making false statements of fact or law to a tribunal.
The second paragraph of FINRA Rule 9150 — that prohibiting an attorney or representative from practicing or appearing in a FINRA proceeding shall not preclude FINRA from initiating other proceedings against such person — serves two related purposes.
First, it prevents an excluded attorney from arguing that their exclusion from a proceeding is a form of double jeopardy or exhaustion that bars FINRA from separately sanctioning their conduct through other regulatory mechanisms. An attorney excluded for contemptuous conduct in a disciplinary hearing has not exhausted FINRA's remedies against them — the exclusion addresses the specific proceeding, while any broader misconduct may independently warrant referral to the attorney's state bar, a separate FINRA proceeding regarding the attorney's own fitness to practice before FINRA, or other regulatory action.
Second, it clarifies the relationship between the proceeding-specific exclusion authority of FINRA Rule 9150 and any broader FINRA authority to regulate the practice of attorneys before it. The exclusion from a particular proceeding is a remedial measure within that proceeding — the broader question of whether an attorney should be prohibited from all FINRA proceedings is a separate matter that would require separate proceedings with appropriate due process protections.
FINRA Rule 9150 operates at the intersection of three other rules in the 9100 and 9200 series framework. FINRA Rule 9141 establishes who may appear in representative capacities in Code proceedings — FINRA Rule 9150 is referenced in FINRA Rule 9141(b) as a limitation on the representation right, confirming that the right to be represented is subject to the Adjudicator's power to exclude. FINRA Rule 9148 prohibits interlocutory review — FINRA Rule 9150 exclusion orders reviewed under FINRA Rule 9280(c) are the only category of as-of-right interlocutory review in the Code, making FINRA Rule 9150 and FINRA Rule 9280(c) the defined exception to FINRA Rule 9148's general prohibition. And FINRA Rule 9280 is the substantive contemptuous conduct rule that both supplies the first ground for exclusion under FINRA Rule 9150(a) and provides the procedural framework for NAC review of exclusion orders under FINRA Rule 9150(a)'s second sentence.
FINRA Rule 9150 is tested on the Series 24 General Securities Principal examination in the context of the Code of Procedure's provisions governing representation, Adjudicator authority over proceedings, and the specific mechanism through which attorneys and representatives may be excluded from disciplinary proceedings.
The key points to retain are these: FINRA Rule 9150 grants Adjudicators discretionary authority — may, not shall — to exclude attorneys and authorized representatives from particular Rule 9000 series proceedings on two grounds: contemptuous conduct under FINRA Rule 9280, and unethical or improper professional conduct in that proceeding; the exclusion is proceeding-specific — it applies only to the particular proceeding in which the conduct occurred and does not constitute a general bar from FINRA proceedings; OHO decisions apply the standard by drawing on judicial attorney disqualification cases, balancing the seriousness of the alleged misconduct against the party's right to representation by counsel of their choosing; an excluded attorney or representative may seek immediate review by the National Adjudicatory Council under FINRA Rule 9280(c) — this is the only category of as-of-right interlocutory review in the Code and constitutes the sole exception to FINRA Rule 9148's general prohibition on interlocutory review; the disciplinary hearing is automatically stayed pending NAC review of an exclusion order under FINRA Rule 9280(c); if the exclusion is upheld by the NAC, the Hearing Officer may grant an adjournment on motion to allow the party to retain new counsel; FINRA Rule 9150(b) confirms that excluding an attorney or representative from a proceeding does not preclude FINRA from initiating separate proceedings against that person for the same or related conduct; FINRA Rule 9150 is cross-referenced in FINRA Rule 9141(b) as a limitation on the representation right and in FINRA Rule 9148 as the exception to the interlocutory review prohibition; and the rule was adopted in 1997 and last amended December 15, 2008 through SR-FINRA-2008-021 with no substantive amendments since original adoption.
