What's the reality?
There is great diversity in how arbitration proceedings are conducted (as another answer notes, there are also lots of forms of ADR, especially mediation, that don't involve testimony at all).
It isn't unusual for testimony that is sworn, or made under penalty of perjury to be used in arbitration, although it is not a universal practice. Arbitrators can administer oaths under the relevant section of the Uniform Arbitration Act (adopted in some form in 35 states and codified in Colorado at Colorado Revised Statutes § 13-22-217(1) which states in pertinent part: "An arbitrator may issue a subpoena for the attendance of a witness and for the production of records and other evidence at any hearing and may administer oaths."). Perjury in those cases could be prosecuted as a crime.
(Footnote: This language of the Uniform Arbitration Act is actually interesting itself because usually oaths can only be administered by government officials who take oaths of office themselves, or by a notary public who takes an oath of office upon receiving a government approved commission. The power to issue subpoenas is likewise usually limited to government appointed court clerks who swear an oath of office, to state licensed attorneys who swear an oath of office and sometimes to certain other sworn government law enforcement officials. But being an arbitrator isn't a regulated profession under the Uniform Arbitration Act or under the laws of the vast majority of states, and the parties to the contract decide who serves in that capacity. A nineteen year old high school dropout with felony sedition and perjury convictions who is an undocumented immigrant and is incarcerated at the time of the arbitration is still legally eligible to serve as an arbitrator. One can't be "disbarred" from serving as an arbitrator either.)
Even absent an oath or affirmation that a statement is made under penalty of perjury, false statements made in a proceeding could constitute criminal fraud.
This said, as a practical matter, perjury prosecutions related to testimony in judicial hearings or trials, or in any other adjudicative proceeding, including arbitrations, is vanishingly rare, and also very rarely provides a valid basis for attacking the validity of an arbitration award.
Consider the case of Colorado, where I live (the quoted material below is from something that I wrote and published elsewhere based upon annual statistical reports from the court system):
Colorado is a state with a population of roughly five million people.
There are many hundreds of thousands of court cases in the state each
year in which often multiple affidavits or declarations are filed and
depositions are taken under oath, there are thousands of evidentiary
hearings in the state courts of the state each year, and there are
myriad documents executed by its citizens under oath or under penalty
of perjury outside a court setting (e.g. in government paperwork).
An intentional false statement of material fact (i.e. a lie) made in
testimony made under oath in a hearing, trial or deposition, or in an
affidavit or a declaration or other document signed under penalty of
perjury, can be prosecuted criminally in a perjury case under state
Most of the statements made under oath do not contain perjury, but a
significant minority percentage do. Even if perjury were committed
just 1% of the time (which is probably low [in the case of disputed
court hearing and trial testimony and arbitration testimony]), there
would be thousands of instances of perjury committed each year in the
State of Colorado.
How many perjury prosecutions were commenced in the entire state of
Colorado in all of its state courts (except Denver county court which
is statistically separate) in the 2019 fiscal year (ending June 30,
There are 5 filed in District Court, which were probably felonies.
There were 2 filed in juvenile delinquency actions. There were 6 filed
in County Court, which were either misdemeanors or criminal complaints
that would later have been transferred to District Court and would be
in that case duplicative.
There are something on the order of a hundred professional arbitrators in the State of Colorado who conduct several thousand arbitrations a year in the state.
Many or most of these prosecutions probably involved intentional lies made in official documents, rather than in court testimony, let alone arbitration testimony.
I would be surprised if there were even 500 perjury prosecutions a year in the entire United States, federal and state and local and territorial and tribal combined, involving perjury during court or administrative hearing testimony, and I would be surprised if there were more than 15 a year in the entire United States in all of those forums combined, arising out of perjury in testimony in arbitration proceedings.
I wouldn't be surprised if there have been no more than one or two such prosecutions, if there have been any, arising out of sworn arbitration testimony or testimony made under penalty of perjury in an arbitration, in Colorado's entire history, with at most one or two more cases in its entire history involving unsworn fraud in arbitration testimony.
There are a variety of reasons why this conduct, which is clearly a crime in both court settings and in arbitrations, is so rarely prosecuted as perjury in criminal proceedings. And, this doesn't take away from the genuine potency of the fact that people who testify know that it is a crime to lie under oath and are told so. But, before considering any of those factors, it is critical to realize that this omnipresent threat is used exceedingly sparingly in practice.