Securities Lawyers Blog
According to BrokerCheck records kept by The Financial Industry Regulatory Authority (FINRA) advisor Frank Zito (Zito), formerly associated with Merrill Lynch, Pierce, Fenner & Smith Incorporated (Merrill Lynch) in Ridgeland, Mississippi and currently registered with Coker & Palmer was terminated concerning allegations that Zito engaged in conduct such as failure to adhere to firm standards regarding selling away and failure to fully disclose participation in an outside business activity. A month earlier in May 2018 a customer filed a complaint against Zito alleging that the broker made unsuitable recommendations and sold unapproved products from 2013 through January 2018. The complaint is currently pending and alleges $571,000 in damages.
At this time, the claims against Zito are unclear as to the exact nature and extent of the unapproved product sale activity. Zito has outside business disclosures including timber purchasing from timber management firm.
It is possible that this activity is related to the alleged Ponzi Scheme orchestrated by Arthur Adams (Adams) and Madison Timber Properties LLC (Madison Timber) by The Securities and Exchange Commission (SEC). The complaint against Adams and Madison Timber was unsealed on May 1, 2018 Mississippi federal court and revealed the SEC’s fraud charges against the Mississippi company and its principal who has been accused of stealing from at least 150 investors in a $85 million Ponzi scheme. Adams and Madison Timber agreed to a permanent injunction, an asset freeze, and expedited discovery.