- February 22, 2023
- Laidlaw & Co.
Edward Short (CRD#: 2462752) is a previously registered Broker.
He entered the securities industry in 1994 and previously worked for Laidlaw & Company (UK) Ltd.; EKN Financial Services, Inc.; Ehrenkrantz King Nussbaum; Weatherly Securities Corporation; Tasin & Company, Inc.; H G I; Americorp Securities, Inc.; and Royce Investment Group, Inc.
Current And Past Allegations Of Conduct Leading To Investment Loss
According to publicly available records released by the Financial Industry Regulatory Authority (FINRA), in January 2023, FINRA sanctioned Edward Short, imposing a civil and administrative penalty of $5,000, ordering restitution of $116,859, and suspending him from all capacities for seven months beginning February 6, 2023 and ending September 5, 2023. The FINRA sanction states, “Without admitting or denying the findings, Short consented to the sanctions and to the entry of findings that he willfully violated the Best Interest Obligation under Rule 15l-1 of the Securities Exchange Act of 1934 (Regulation BI) by recommending a series of trading in an elderly customer’s account that was excessive, unsuitable, and not in the customer’s best interest. The findings stated that the customer relied on Short’s advice and routinely followed his recommendations and, as a result, Short exercised de facto control over the customer’s account. As a result of Short’s trading, the customer’s account generated $116,859 in commissions and resulted in approximately $185,000 in trading losses, an annualized cost-to-equity ratio of 76.53 percent, and an annualized turnover rate of 47.49. The high cost-to-equity ratio meant the customer’s account would have to grow by more than 76 percent annually just to break even. This level of trading was excessive, unsuitable, and not in the customer’s best interest.”
For a copy of the FINRA sanction, click here.
In addition, Edward Short has been the subject of five other disclosures, including the following:
- December 2011 — “CLIENT COMPLAINED ABOUT LOSSES IN HIS ACCOUNT FROM JULY 1, 2011 TO DECEMBER 2011, ALSO IMPLIED THAT SOME OF THE TRADES WERE UNAUTHORIZED.” The customer dispute was withdrawn.
- November 2009 — “CUSTOMER ALLEGES THAT THE BROKER FAILED TO CANCEL AN OPEN STOP-LOSS ORDER. SUBSEQUENTLY, THE STOCK WAS STOPPED OUT, WHICH THE CUSTOMER IS CLAIMING AS AN UNAUTHORIZED TRADE.” The customer dispute was closed with no action.
- November 2009 — “VIOLATION STATUTE 893.13 – POSSESSION OF COCAINE.” The criminal case was dismissed.
- May 2005 — “UNSUITABLE TRADES,UNREASONABLE COMMISSIONS, MISREPRESENTATION. ACTIVITY FROM 11/2000 TO 02/2004. ACTIVITY FROM 11/2000 TO 10/2001 OCCURRED WITH THE FIRM WEATHERLY SECURITIES.” The customer dispute was settled for $450,000.
- July 1998 — “ALLEGED FAILURE TO FOLLOW CLIENT’S INSTRUCTIONS.” The customer dispute was settled for $30,000.
For a copy of Edward Short’s FINRA BrokerCheck, click here.
We Help Investors Recover Investment Losses
Financial advisors have a legal and regulatory obligation to recommend only suitable investments that are appropriate for their clients’ needs and objectives. Their employing brokerage firm has a legal and regulatory obligation to supervise the Financial Advisors’ sales practices and dealings with clients. To the extent any of these duties are breached, the customer may be entitled to a recovery of his or her investment losses.
Reasonable basis suitability requires that a recommended investment or investment strategy be suitable or appropriate for at least some investors. Reasonable basis suitability requires an advisor to conduct adequate due diligence so that he or she can determine the risks and rewards of the investment or investment strategy.
Quantitative suitability requires a brokerage firm or financial advisor with actual or de facto control over a customer’s account to have a reasonable basis for believing that a series of recommended transactions – even if suitable when viewed in isolation – is not excessive and unsuitable for the customer when taken together in light of the customer’s investment profile. No single test defines excessive activity, but factors such as the turnover rate, the cost-equity ratio, and the use of in-and-out trading in a customer’s account may provide a basis for a finding that a member or associated person has violated the quantitative suitability obligation.
Customer-specific suitability requires that a member or associated person have a reasonable basis to believe that the recommendation is suitable for a particular customer based on that customer’s investment profile. Among the criteria that a financial advisor must evaluate to satisfy his or her customer-specific suitability obligations include the investor’s age, tax status, time horizon, liquidity needs, and risk tolerance; a client’s other investments, financial situation and needs, investment objectives, and any other information disclosed by the customer should also be considered.
The Wolper Law Firm, P.A. represents investors nationwide in securities litigation and arbitration on a contingency fee basis. Matt Wolper, the Managing Principal of the Wolper Law Firm, P.A., is a trial lawyer who has handled hundreds of securities cases during his career involving a wide range of products, strategies and securities. Prior to representing investors, he was a partner with a national law firm, where he represented some of the largest banks and brokerage firms in the world in securities matters. We can be reached at (800) 931-8452 or by email at firstname.lastname@example.org.