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Scott Mass is Facing Allegations of Misrepresentation and Unsuitable Recommendations

Scott Mass (CRD #: 1971403), a broker registered with David Lerner Associates, has racked up his fourth investor dispute since 2016. This disclosure appears on his BrokerCheck record, accessed on December 20, 2023. Keep reading if you have questions about his alleged conduct. 

On November 13, 2023, an investor alleged that Scott Mass recommended unsuitable investments. They further alleged that he made misrepresentations and omissions. 

Misrepresentation

FINRA Rule 2020 prohibits the misrepresentation of investments and omission of material facts. Material facts include information about an investment’s dividends. 

What is a Suitable Investment?

FINRA defines suitable investments as securities that fit an investor’s profile. An investor’s profile includes information about their risk tolerance, financial goals, and age. 

FINRA Rule 2111 identifies the three prongs of a suitability determination as 1) reasonable-basis suitability, 2) customer-specific suitability, and 3) quantitative suitability.

  1. Reasonable-basis Suitability: Brokers are required to use reasonable diligence before making a recommendation. This means they have an obligation to understand an investment strategy and its potential risks or rewards.
  2. Customer-specific Suitability: Before recommending a particular security or investment strategy involving a specific client, brokers are required to have reasonable grounds for believing it will be suitable based on that client’s personal profile. The profile includes information on the investor’s financial goals, investing experience, and risk tolerance. 
  3. Quantitative Suitability: Brokers with control over a customer’s account must have a reasonable basis to believe that the series of transactions they recommend are not excessive before executing them. Excessive transactions run the risk of incurring too many fees and negating any returns. 

Investors who rely on their brokers for recommendations may be able to recover their losses through FINRA arbitration.

FINRA Rule 2010

FINRA Rule 2010 holds brokers to high standards of commercial honor and just and equitable principles of trade. Violations of FINRA Rule 2020 and Rule 2111 violate this rule. 

Background Information 

Scott Mass has passed the following exams: 

  • Series 63 Uniform Securities Agent State Law Examination 
  • SIE – Securities Industry Essentials Examination 
  • Series 7 General Securities Representative Examination
  • Series 24 General Securities Principal Examination 

He is a registered broker in 24 states and Puerto Rico.  

Kurta Law Can Help 

If you have worked with Scott Mass and have concerns about your investments, do not hesitate to contact us at 877-600-0098 or info@kurtalawfirm.com for a free consultation. 

For nearly 20 years, Kurta Law has advocated for investors to recover their investment losses from brokers and brokerage firms. Kurta Law is a nationally recognized law firm that exclusively represents investors against brokers and brokerage firms on a contingency basis. This means that the firm only earns a fee if our securities attorneys recover money on your behalf. Do not let securities fraud go unchecked. Start your recovery process today.