Scottsdale Investment Adviser Loses License After Describing Jail Absence As ‘Sabbatical’



October 16, 2026

By Matthew Holloway |

The Arizona Corporation Commission (ACC) revoked a Scottsdale investment advisory business’s license and imposed a $2,500 administrative penalty after finding that its owner misled clients about a yearlong jail sentence and made false statements in regulatory filings about his felony conviction.

The commission approved the consent agreement involving Paul Marascalco and his sole proprietorship, Paul Marascalco Registered Investment Advisor, during its Oct. 7 open meeting, according to an Oct. 13 Securities Division filing. The ACC announced the enforcement action that same day.

The consent agreement states that the business had been licensed as an investment adviser since May 2015 and operated from Scottsdale. It provided investment advisory services to approximately 20 clients around December 2020, charging fees based on assets under management.

According to the agreement’s findings, Marascalco drove while intoxicated in Chandler on Dec. 25, 2020, failed to stop at a stop sign, and collided with another vehicle around 8:15 p.m. All five passengers in the other vehicle were injured and taken to a hospital, including a child who suffered a compound fracture to her arm.

Police tested Marascalco’s blood, with the lowest of three results showing a blood-alcohol concentration of approximately 0.202%.

Marascalco pleaded guilty to aggravated assault, a Class 3 felony, on Sept. 10, 2021. The court accepted his plea on Nov. 10, 2021, and sentenced him to three years of supervised probation. The sentencing terms included substance-abuse treatment and a 12-month jail term, with two days of credit for time served and no eligibility for early-release credits.

A week before sentencing, Marascalco emailed clients to announce that another investment adviser would oversee his practice during his absence. He described personal issues requiring his attention and called the planned leave a “sabbatical in some ways,” according to the email excerpt reproduced in the agreement.

Marascalco told clients he expected to be away for approximately one year and assured them he was neither retiring nor closing the practice. He also said he would remain involved in all decisions and trades associated with their accounts.

The agreement’s findings state that he did not tell clients the absence resulted from his felony conviction and jail sentence or explain that continued involvement in all account decisions and trades would be extremely unlikely during incarceration.

One client independently learned of the arrest and conviction and left the firm, rejecting the substitute adviser’s services largely because the client believed Marascalco had been dishonest about his forthcoming absence.

On Nov. 10, 2022, Marascalco emailed clients to say he had returned to the office. The findings state that he again omitted the reason for his absence and did not disclose that he had been unable to remain involved in all account decisions and trades while incarcerated.

The regulatory filings described in the agreement contained inconsistent disclosures about the conviction.

In Form ADV filings dated June 21 and July 30, 2025, and Jan. 19, 2026, Marascalco denied a felony conviction or guilty plea within the preceding 10 years. The agreement states that the filings were certified under penalty of perjury. In the January filing, he acknowledged a felony charge while denying a conviction or guilty plea.

A July 31, 2025, Form ADV Part 2B characterized the incident as a traffic violation involving a minor accident. An Aug. 11, 2025, version disclosed the aggravated assault conviction, supervised probation, and a 12-month jail condition. A subsequent version also asserted that no clients had been lost, despite the agreement’s account of the client who left after learning about the conviction.

The ACC announcement said Marascalco’s conduct constituted dishonest and unethical practices in the securities industry. Under the consent terms, the respondents admitted the findings and legal conclusions for purposes of the commission proceeding and specified related proceedings, and waived their rights to a hearing and appeal.

The agreement assigns the $2,500 administrative penalty to the sole proprietorship, with payment due within five months of the order. It also revokes the business’s investment adviser license and permanently orders the respondents and their agents, employees, successors, and assigns to cease and desist from violating Arizona’s Investment Management Act.

Marascalco agreed not to apply or reapply in Arizona for registration as a securities dealer or salesman, or for licensure as an investment adviser or investment adviser representative. The respondents also agreed not to offer investment adviser or representative services within or from Arizona at any time.