South Florida Arbitration & Litigation Lawyer Blog
Broker/Dealer and Investment Advisor Unauthorized Outside Business Activity and Selling Away FINRA Arbitration and Litigation Lawyer, Russell L. Forkey, Esq.
March, 2012:
Scott David Mason (CRD #3270983, Registered Principal, Debary, Florida) submitted an Offer of Settlement in which he was suspended from association with any FINRA member in any capacity for 18 months and required to requalify by examination prior to associating with any member firm in any capacity after the suspension. In light of Mason’s financial status, no monetary sanction was imposed. Without admitting or denying the allegations, Mason consented to the described sanctions and to the entry of findings that he established a hedge fund and participated in the sale of limited partnership units in the hedge fund to investors without his firm’s approval. The findings stated that Mason failed to advise his firm that he had participated in the sale of the limited partnership units and failed to disclose his participation and continuing involvement on firm annual certifications. The findings also stated that Mason raised more than $1million in the sale of the limited partnership units outside the scope of his business with his firm. The findings also included that Mason sold the limited partnership units while not registered with FINRA in a capacity that permitted him to sell the units when he did sell them. FINRA found that Mason opened securities accounts for the hedge fund with other FINRA member firms and did not advise these firms that he was associated with a member firm, and did not advise his firm that he had opened securities accounts with other firms. FINRA also found that Mason did not request that duplicate confirmations and account statements be forwarded to his member firm.
The suspension is in effect from February 21, 2012, through August 20, 2013. (FINRA Case #2009016363501).