Securities Arbitration Lawyer Blog
FINRA has barred former Merrill Lynch broker Scott Madison from the securities industry after he failed to provide information and documents requested by FINRA in connection with its investigation into the circumstances of his termination from Merrill Lynch.
If you have suffered investment losses with Scott Madison, or Merrill Lynch, contact New York securities arbitration lawyers Iorio Altamirano LLP for a free and confidential evaluation of your account.
Iorio Altamirano LLP represents investors nationwide that have disputes with their financial advisors or brokerage firms.
FINRA Letter of Acceptance, Waiver, and Consent No. 2021070757901
Scott Madison and FINRA entered into a Letter of Acceptance, Waiver, and Consent (“AWC”) on August 30, 2021, after FINRA alleged that Mr. Madison failed to provide information and documents that were requested pursuant to FINRA Rule 8210, in violation of FINRA Rules 8210 and 2010.
FINRA indicated that the matter originated from its review of the Form U5 filed by Merrill.
FINRA Rule 8210(a)(1) states, in relevant part, that FINRA may require a person subject to its jurisdiction “to provide information orally, in writing, or electronically … with respect to any matter involved in [a FINRA] investigation [or] examination.” FINRA Rule 8210(c) further states that “[n]o … person shall fail to provide information … pursuant to this Rule.” A violation of FINRA Rule 8210 is also a violation of FINRA Rule 2010, which requires member firms and their associated persons to “observe high standards of commercial honor and just and equitable principles of trade.”
On July 2, 2021, in connection with an investigation into the circumstances of Mr. Madison’s termination from Merrill, FINRA sent a request to Mr. Madison for the production of information and documents pursuant to FINRA Rule 8210. Through his counsel on August 3, 2021, and by the agreement, Mr. Madison acknowledged that he received FINRA’s request and would not produce the information or documents requested at any time.
By refusing to produce the information and documents as requested pursuant to FINRA Rule 8210, Mr. Madison violated FINRA Rules 8210 and 2010.
Scott Madison (CRD#: 4323032)
Mr. Madison first became registered with FINRA as a General Securities Representative in March 2001. Mr. Madison was registered with FINRA in that capacity through multiple firms from March 2001 to December 2017.
In December 2017, Mr. Madison became registered in that capacity through an association with Merrill Lynch, Pierce, Fenner & Smith Inc. (CRD No. 7691). On March 19, 2021, Merrill filed a Uniform Termination Notice for Securities Industry Registration (Form U5) stating that Mr. Madison’s registration was terminated for “[c]onduct including failure to produce documents requested as part of a firm review.” The Form U5 also disclosed that at the time of termination, Mr. Madison had been under internal review “to determine if registered representative improperly applied for and received an Economic Injury Disaster Loan (EIDL).”
Mr. Madison is not currently registered or associated with a FINRA member. However, he remains subject to FINRA’s jurisdiction pursuant to FINRA’s By-Laws.
Mr. Madison’s public FINRA CRD also shows one prior customer complaint alleging unauthorized trading, unsuitable investment recommendations, and churning from December 27, 2017, until September 2019. The matter was related to Mr. Madison’s previous registration with Stifel Nicolaus & Company and settled for $50,000 in December 2020.
Merrill Lynch – A Duty to Supervise
Financial institutions like Merrill Lynch must properly supervise financial advisors and customer accounts. Brokerage firms must establish and maintain a reasonably designed supervisory system to ensure their registered representatives’ compliance with firm policies, securities laws, and industry regulations. When a brokerage firm fails to supervise its financial advisors or the investment account activity sufficiently, it may be liable for investment losses sustained by customers.
How to Recover Losses or Obtain a Free Consultation
If you have suffered investment losses with Scott Madison, or Merrill Lynch, contact New York securities arbitration lawyer Jorge Altamirano of Iorio Altamirano LLP at jorge@ia-law.com or toll-free at (855) 430-4010 for a free and confidential evaluation of your account.
Iorio Altamirano LLP is a securities arbitration law firm based in New York, NY. We pursue FINRA arbitration claims nationwide on behalf of investors to recover financial losses arising out of wrongful conduct by financial advisors and brokerage firms.