Court Rejects Scottsdale Capital Advisors FINRA Challenge

Scottsdale Capital Advisors’ lawsuit against the Financial Industry Regulatory Authority must be dismissed for lack of jurisdiction, a federal court ruled July 16.

FINRA has fined, sanctioned, and censured Scottsdale for various violations, including the company’s dealings in unregistered penny stocks. The company is the subject of ongoing FINRA disciplinary proceedings.

Scottsdale went on the offensive, suing FINRA for alleged breaches of the membership agreement the brokerage entered when joining the organization and of the Securities Exchange Act of 1934.

Specifically, Scottsdale charged that FINRA hasn’t allowed members to elect enough of its governors; that FINRA has promulgated guidance about ...