Edward Scott Short of Melville, New York, a stockbroker registered with Laidlaw Company (Uk) Ltd., has been fined $5,000.00 and suspended for seven months from associating with any Financial Industry Regulatory Authority (FINRA) member in any capacity because Short engaged in excessive and unsuitable trading. Letter of Acceptance, Waiver, and Consent No. 2020065683302 (January 31, 2023).
According to the AWC, between July of 2018 and December of 2020, Short recommended a series of unsuitable and excessive trades in an elderly customer’s account. FINRA stated that the customer depended on Short’s advice and regularly followed it. As a result of Short’s trading activities, the customer’s account incurred $116,859.00 in commissions and suffered trading losses amounting to approximately $185,000.00.
The annualized cost-to-equity ratio in the customer’s account was 76.53 percent, while the annualized turnover rate reached 47.49. Such a high cost-to-equity ratio meant that the customer’s account needed to grow by more than 76 percent annually for the customer’s account to break even. The excessive level of trading conducted by Short was unsuitable and did not align with the best interests of the customer, according to FINRA. Therefore, Short violated Securities Exchange Act of 1934 Rule 15l-1 as well as FINRA Rules 2010 and 2111.
FINRA Public Disclosure shows that Short is referenced in four customer initiated investment related disputes concerning Short’s conduct while associated with securities broker dealers. On January 19, 2007, a customer initiated investment related NASD securities arbitration claim involving Short’s conduct was settled for $450,000.00 in damages based upon allegations that Short engaged in unsuitable trading, charged excessive commissions, and made misrepresentations of material fact in connection with the sale of over the counter equities when Short was associated with Ehrenkrantz King Nussbaum Inc. NASD Arbitration No. 05-02018.
On January 27, 2010, another customer filed an investment related complaint involving Short’s conduct in which the customer requested $20,823.00 in damages based upon allegations that Short engaged in unauthorized trading when Short was associated with EKN Financial Services Inc.
Short was also referenced in a customer initiated investment related complaint filed on December 20, 2011, in which the customer requested $84,000.00 in damages based upon allegations that Short engaged in unauthorized trading in over the counter equities and stocks during the time that Short was associated with EKN Financial Services Inc.
Short’s registration with Laidlaw Company (Uk) Ltd. was terminated on October 13, 2022.
