March, 2025 | Based in Dallas, TX
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Critical Information About Rajesh Markan
- Full Name: Rajesh Markan
- CRD Number: 4553309
- Current Location: Dallas, TX
- Current Employment Status: Not currently registered as a broker
- Previous Employers: Hilltop Securities Inc. (10/2022 – 08/2024), Merrill Lynch (05/2009 – 11/2022), Citigroup Global Markets (11/2006 – 05/2009)
- Registration Status: Permanently barred by FINRA as of 10/01/2024
- FINRA BrokerCheck: Multiple customer disputes totaling over $4 million in claimed damages
- Alleged Misconduct: Fraud, misappropriation of funds, creating fraudulent investment schemes
- Ability to Recover Losses: Potentially through FINRA arbitration against former employers
Detailed Case Overview
Rajesh Markan, a former financial advisor most recently employed by Hilltop Securities Inc., is currently facing multiple serious allegations of investment fraud and misconduct. According to FINRA BrokerCheck records, Markan has been permanently barred from the securities industry as of October 1, 2024, following his refusal to cooperate with a FINRA investigation into alleged fraud and misappropriation of client funds.
The investigation into Markan’s activities reveals a disturbing pattern of alleged misconduct. According to FINRA documentation, Markan is accused of creating fraudulent investment schemes, primarily described as “bogus hedge funds” or “private equity funds.” Multiple clients have filed complaints alleging that Markan solicited them to invest in these fraudulent outside investments, misappropriated their funds, and created false prospectuses and other materials to facilitate the scheme.
Currently, there are eight pending customer disputes against Markan, with claimed damages totaling over $4 million. These complaints have been filed by former clients from both Hilltop Securities and Merrill Lynch, where Markan was previously employed. The allegations consistently describe a pattern of soliciting investments in fraudulent hedge funds or private equity vehicles, followed by misappropriation of the invested funds.
One particularly concerning aspect of this case is the apparent sophistication of the alleged fraud. According to arbitration filings, Markan is accused of creating not just verbal misrepresentations but actual fraudulent materials including prospectuses and fund documentation that appeared legitimate to investors. This level of premeditation suggests a calculated effort to deceive clients who trusted him with their investments.
Historical and Background Information
Rajesh Markan has been in the financial services industry since 2002, when he began his career with Ameriprise Financial Services and IDS Life Insurance Company. He subsequently moved to Citigroup Global Markets in 2006, before joining Merrill Lynch in 2009, where he remained until 2022. His final position was with Hilltop Securities Inc., where he worked from October 2022 until August 2024.
Throughout his career, Markan passed several securities industry exams, including the Securities Industry Essentials Examination, the General Securities Representative Examination (Series 7), and the Uniform Combined State Law Examination (Series 66). These qualifications allowed him to work as a registered representative selling securities products to retail clients.
Markan’s troubles appear to have begun in October 2022, when he voluntarily resigned from Merrill Lynch amid allegations of “conduct involving failure to disclose a loan to a client.” This resignation came just before he joined Hilltop Securities. While this initial issue might have seemed relatively minor, it appears to have been just the beginning of more serious allegations that would emerge later.
By August 2024, the first formal customer complaints began to surface, with clients alleging that Markan had solicited them to invest in fraudulent outside investments. These complaints quickly multiplied, with multiple arbitration cases filed through FINRA between August and February 2025.
Red Flags & Warning Signs
The Markan case highlights several critical red flags that investors should be aware of when working with financial advisors:
- Solicitation of Private Investments: Markan allegedly solicited clients to invest in private hedge funds or equity funds outside of his employing firms’ approved products. This type of “selling away” is a serious violation of securities regulations and firm policies.
- Misappropriation of Funds: Multiple complaints allege that Markan misappropriated client funds, using their investments for purposes other than what was represented.
- Creation of Fraudulent Materials: According to the complaints, Markan created bogus prospectuses and other materials to make the fraudulent investments appear legitimate.
- Regulatory Red Flags: Markan’s FINRA BrokerCheck report shows he was permanently barred from the industry for refusing to cooperate with a FINRA investigation, a clear sign of serious misconduct.
- Pattern of Misconduct Across Multiple Firms: The complaints span Markan’s time at both Merrill Lynch and Hilltop Securities, suggesting a pattern of misconduct that continued despite changing employers.
- Undisclosed Loans: The initial issue that led to Markan’s resignation from Merrill Lynch involved an undisclosed loan to a client, which is a violation of industry regulations and firm policies.
- Lack of Transparency: The creation of apparently sophisticated but fraudulent investment documentation suggests a deliberate effort to deceive clients and circumvent regulatory oversight.
Legal & Regulatory Framework
The allegations against Rajesh Markan involve violations of several key FINRA rules and securities regulations:
FINRA Rule 2010 requires brokers to observe high standards of commercial honor and just and equitable principles of trade. The creation of fraudulent investment schemes and misappropriation of client funds would constitute clear violations of this foundational rule.
FINRA Rule 3270 prohibits outside business activities without proper disclosure and approval from the broker’s firm. Selling investments outside of the firm’s approved products (“selling away”) violates this rule.
FINRA Rule 2150 specifically prohibits the misuse of customer funds and securities, which is directly relevant to the misappropriation allegations.
FINRA Rule 8210 requires brokers to cooperate with FINRA investigations by providing information and documents when requested. Markan’s refusal to cooperate with FINRA’s investigation led to his permanent bar from the industry.
SEC Rule 10b-5 prohibits the use of any device, scheme, or artifice to defraud in connection with the purchase or sale of securities. Creating fraudulent investment materials would violate this rule.
Under these regulations, financial advisors have a fiduciary duty to act in their clients’ best interests, provide full and fair disclosure of all material facts, and avoid conflicts of interest. The allegations against Markan suggest systematic violations of these duties through deception and misappropriation.
The permanent bar imposed by FINRA is the most severe sanction available and effectively prevents Markan from working in the securities industry in any capacity. This regulatory action is separate from any potential civil or criminal proceedings that may arise from the alleged misconduct.
Guidance for Affected Investors
If you believe you may have been affected by Rajesh Markan’s alleged misconduct, here are critical steps you should consider taking:
- Review Your Account Statements: Carefully examine all account statements and investment documentation related to any investments recommended by Markan, particularly those involving hedge funds or private equity vehicles.
- Gather Documentation: Collect all communications with Markan, including emails, text messages, and written correspondence, as well as any investment agreements, prospectuses, or other materials provided to you.
- Consult with a Securities Attorney: Given the complexity of investment fraud cases and the specific allegations involving Markan, it’s crucial to consult with an attorney who specializes in securities law and investment fraud.
- File a FINRA Arbitration Claim: If you’ve suffered financial losses due to Markan’s alleged misconduct, you may be eligible to file a FINRA arbitration claim not only against Markan but potentially against his employing firms under failure to supervise theories.
- Act Promptly: Be aware that there are strict time limitations (statutes of limitations) that apply to securities fraud claims. Generally, these claims must be filed within six years of the violation or within two years of when you should have discovered the violation.
- Consider Regulatory Reporting: If you haven’t already done so, consider reporting your experience to FINRA and the SEC, as this may assist in ongoing investigations.
- Be Wary of Recovery Offers: If you’re approached with offers to help recover your losses, exercise caution. Fraudsters sometimes target victims of investment scams with “recovery scams” that require upfront fees but deliver no results.
Legal & Recovery Options
If you’ve suffered losses due to Rajesh Markan’s alleged misconduct, you have several potential avenues for recovery:
FINRA Arbitration: The most common method for investors to recover losses from broker misconduct is through FINRA arbitration. This process allows investors to pursue claims against brokerage firms and their representatives without going through traditional court proceedings. The multiple pending arbitrations against Markan suggest that many investors are already pursuing this route.
Claims Against Employing Firms: Even though Markan has been barred from the industry and may not have the financial resources to satisfy judgments against him personally, his former employers may be liable under failure to supervise theories. Brokerage firms have a duty to supervise their representatives and may be held responsible for failing to detect and prevent misconduct.
Insurance Recovery: Brokerage firms typically maintain errors and omissions insurance that may cover customer losses resulting from broker misconduct. This can be an important source of recovery in cases where significant losses have occurred.
Securities Investor Protection Corporation (SIPC): While SIPC protection does not cover investment losses due to fraud or market fluctuations, it may provide some recovery if a brokerage firm fails and customer assets are missing.
Regulatory Restitution: In some cases, regulatory actions by FINRA or the SEC may result in restitution funds being created for affected investors. However, these funds typically provide only partial recovery and may take years to distribute.
Our securities fraud attorneys specialize in representing investors who have suffered losses due to broker misconduct. We offer:
- Free, no-obligation case evaluations to assess your potential claims
- Detailed forensic analysis of your investment accounts and transactions
- Representation on a contingency fee basis, meaning we only get paid if we recover money for you
- Experienced litigation teams with specific expertise in broker fraud cases
- A proven track record of successful recoveries in similar cases
If you invested with Rajesh Markan at Merrill Lynch, Hilltop Securities, or any other firm and suspect you may have been affected by his alleged misconduct, don’t wait to take action. The evidence in this case suggests a systematic pattern of fraud that may have affected numerous investors across multiple firms.
Take the first step toward potential recovery by contacting our investment fraud attorneys today. Call 800-950-6553 or complete our online form to schedule your confidential consultation and learn about your legal options.
