Investors who take their brokers and broker-dealers to arbitration are opting overwhelmingly to have their cases heard by 3-person arbitration panels that have no ties to broker-dealers or banks.  For years, arbitration panels had to have one member who came from Wall Street. But that arrangement has long been criticized for being stacked in favor of the big brokerage firms.  So in 2008, FINRA launched a pilot program that allowed investors to pick an all-public panel.  Over the next 3 years, 54% of eligible investors opted for an all-public panel, according to Linda Feinberg, the President of FINRA Dispute Resolution. Then, earlier this year, the program was made permanent, and now 77% of investor claimants are opting for the all-public panel.  Ms. Feinberg believes the increase is due largely to investor skepticism about the pilot program because it was a new initiative.  She also said that strong negative sentiment for Wall Street factors into the high numbers. George Friedman, EVP of FINRA-DR said the authority had stepped up its efforts to remind arbitrators to disclose any potential conflicts.  Arbitration awards are hard to overturn, and parties looking to have one reversed must show things like fraud or disregard of the law in the process.  Mr. Friedman said arbitrator bias was “the most common ground” parties used to try to have awards overturned.  As a result, he said, arbitrator training manuals for Finra now list cases where awards have been overturned because of arbitrator bias.   [DealBook, 10/27/11]