According to FINRA, Scott Lewis was fined $5,000 and suspended from association with any FINRA member in all capacities for one month.
Lewis falsely certified to the State of New York that he had personally completed 15 hours of continuing education required to renew his state insurance license when, in fact, another person had completed that continuing education on his behalf. This false certification constitutes fraud against the state insurance regulator and demonstrates a lack of integrity.
Continuing education requirements serve an important purpose in maintaining professional competence. Insurance and securities products and regulations evolve over time, and continuing education ensures that licensed professionals stay current. By having someone else complete the required education, Lewis failed to gain the knowledge and skills the education was designed to provide, potentially leaving him less equipped to properly serve his customers.
The willingness to lie to a regulator about compliance with licensing requirements is a serious character issue. It shows a preference for taking shortcuts rather than fulfilling professional obligations honestly. While the immediate violation involved an insurance license rather than securities licenses, it reflects poorly on Lewis's overall fitness to work in financial services.
Many financial professionals hold both securities and insurance licenses, allowing them to offer a comprehensive range of financial products including securities, annuities, and life insurance. These professionals must comply with the requirements of both securities and insurance regulators. A violation of insurance regulations can have consequences for their securities registration as well.
The one-month suspension means Lewis could not work in the securities industry during that time, resulting in lost income. The $5,000 fine provides additional financial consequences. Most importantly, this disciplinary action becomes a permanent part of Lewis's regulatory record, visible to investors who check BrokerCheck and to firms considering employing him.
This case, along with several similar cases in this month's disciplinary actions involving New York insurance continuing education fraud, suggests a broader pattern that FINRA and state insurance regulators identified and pursued. Investors should verify their broker's licensing and disciplinary history through BrokerCheck.
