The securities lawyers of Gana LLP are investigating customer complaints filed with The Financial Industry Regulatory Authority’s (FINRA) against broker Neal Scott (Scott). According to BrokerCheck records there are at least four customer complaint, one regulatory, and seven judgments or liens that have been filed against Scott. The most recent customer complaint against Scott alleges a number of securities law violations including breach of fiduciary duty and suitability among other claims. The claim is currently pending.
The most recent judgement or lien disclosure was filed in January 2009 and concerns a tax lien for $47,103. Tax liens and judgements are often a sign that the broker cannot manage their own personal finances and may be tempted to recommend high commission products or strategies to clients in order to satisfy debts.
In addition, the Virginia Securities Department alleged that Scott failed to complete his registration process in time and denied his registration in the state.
Brokers have a responsibility treat investors fairly which includes obligations such as making only suitable investments for the client. In order to make a suitable recommendation the broker must meet certain requirements. First, there must be reasonable basis for the recommendation the product or security based upon the broker’s investigation and due diligence into the investment’s properties including its benefits, risks, tax consequences, and other relevant factors. Second, the broker then must match the investment as being appropriate for the customer’s specific investment needs and objectives such as the client’s retirement status, long or short term goals, age, disability, income needs, or any other relevant factor.