Our investment attorneys are investigating customer complaints filed with The Financial Industry Regulatory Authority (FINRA) against financial advisor William Ornstein (Ornstein) currently registered with The GMS Group, LLC. (GMS), alleging unsuitable investments, fraud, unauthorized trading, over-conentration, and material misrepresentations among other claims. According to brokercheck records Ornstein has been subject to nine customer complaints, one regulatory action, and two criminal matters.
In November 2015 a customer filed a complaint alleging that Ornstein made fraudulent sales and over-concentrated the account from 2011 through 2015. The complaint involves oil and gas related master limited partnership (MLP) investments and municipal debt securities. The customer is seeking $200,000 in damages. The claim is current pending.
Brokers in the financial industry have the fundamental responsibility to treat investors fairly. This obligation includes making only suitable investments for their client. The suitable analysis has certain requirements that must be met before the recommendation is made. First, there must be reasonable basis for the recommendation for the investment based upon the broker’s and the firm’s investigation and due diligence. Common due diligence looks into the investment’s properties including its benefits, risks, tax consequences, the issuer, the likelihood of success or failure of the investment, and other relevant factors. Second, if there is a reasonable basis to recommend the product to investors the broker then must match the investment as being appropriate for the customer’s specific investment needs and objectives. These factors include the client’s age, investment experience, retirement status, long or short term goals, tax status, or any other relevant factor.