Michael Norton, David Lerner Broker, Investigated by FINRA

Michael Norton (CRD# 2617985[1]), a broker registered with David Lerner Associates, recommended unsuitable energy investments, according to a regulatory investigation. MDF Law is investigating the Syosset, New York-based financial professional for similar conduct. If you have concerns about investments in your accounts, call our firm for a free and confidential discussion with an attorney.

Continue reading this post to learn more about the probe into Mr. Norton’s recommendations. The information herein is based on a January 30, 2025 review of his BrokerCheck record, a Financial Industry Regulatory Authority profile. 

Investigation Stemmed from Energy 11, Energy 12 Investments

On November 18, 2024, FINRA disclosed its investigation into Mr. Norton. As a disclosure on his BrokerCheck profile reflects, the probe concluded with a recommendation to recommend disciplinary action against him. The proposed action would allege that he violated FINRA rules when he recommended investments in Energy 11 LP and Energy Resources 12 LP absent a reasonable basis to believe they were suitable. The action would also allege that he violated industry rules by causing his member firm to maintain inaccurate books and records, specifically those concerning customers’ profiles. FINRA has not yet undertaken the proposed action.

Understanding Important FINRA Rules

According to FINRA’s disclosure, its proposed disciplinary action would allege violations of three vital securities industry rules:

• FINRA Rule 2010, which mandates that brokers observe high standards of commercial honor and just and equitable principles of trade.
• FINRA Rule 2111, under which brokers may only recommend transactions or strategies that are considered suitable for a client’s profile.
• FINRA Rule 4511, under which broker-dealer firms must create and preserve books and records in accordance with the Securities Exchange Act of 1934.

In Statement, Michael Norton Defends Against Proposed Allegations

Mr. Norton issued a “Broker Comment,” found on his BrokerCheck profile, regarding FINRA’s proposed sanction. In it, he asserts that he “strongly” disagrees with the allegations proposed by FINRA. “I take my regulatory responsibilities, and my responsibilities to my clients, very seriously,” he argues further. “I have meritorious defenses which I intend to vigorously pursue, including that my recommendations were suitable and consistent with the firm’s compliance protocols.”

Past Disputes Concerned Energy 11, Puerto Rico Bonds

Between 2019 and 2024, four parties of investors filed disputes involving Mr. Norton. These claims detailed allegations of unsuitable investment recommendations, misrepresentations, breach of fiduciary duty, and negligence. They stemmed from investments in mutual funds, an Energy 11 private placement, Puerto Rico bonds, and other products. His member firm settled the disputes for a total of more than $121,900.

FINRA: Broker Based in Syosset, New York

Mr. Norton launched his career as a broker when he registered with Marlowe & Company in 1995. He remained at the firm until 1997, when he departed to join Meyers Pollock Robbins. Later that same year, he left the firm, eventually joining David Lerner Associates in 1998. He remains at David Lerner today, working out of its office in Syosset, New York. With 28 years of experience as a broker, he has completed four industry exams, including the Series 65 and the Series 63.

You May Be Able to Recover Investment Losses

If you have lost money on investments in Energy  11, Energy 12, Puerto Rico bonds, or other products recommended by Michael Norton, you may have recovery options. At MDF Law, our investment fraud attorneys[2] have proven experience advocating for investors through the FINRA arbitration process. We have secured tens of millions in recoveries for our clients, who only pay a fee if they win. Call 800-767-8040 for a free consultation today.