The attorneys at Gana Weinstein LLP are investigating BrokerCheck records reports that Broker Doran James (James), currently employed by J.w. Cole Financial, INC. has been subject to at least 3 disclosable events. These events include 3 customer complaints. According to records kept by The Financial Industry Regulatory Authority (FINRA), James’s most recent customer complaint alleges that James recommended unsuitable investments in structured products and makes allegations concerning misconduct relating to the handling of the customer’s accounts.
FINRA BrokerCheck shows a pending customer complaint with a damage request of $154,957.00 on December 04, 2024.
Claimants allege their financial professional could not sell their structured notes prior to maturity which caused themalleged damages. Time period: December 2022 – January 2023
FINRA BrokerCheck shows a pending customer complaint with a damage request of $219,735.00 on October 31, 2024.
Claimants allege their financial professional could not sell their structured notes prior to maturity which caused themalleged damages. Time period: December 2022 – January 2023
FINRA BrokerCheck shows a pending customer complaint with a damage request of $124,947.00 on February 03, 2024.
Claimants allege their financial professional could not sell their structured notes prior to maturity which caused themalleged damages. Time period: December 2022 – January 2023
Marketlinked data drives the performance of structured products, which are a type of derivative. A structured product is commonly tied to a reference index that determines its market risk. The source can be a single security, a basket of securities such as a market index, commodities, interest rates, or a real estate loan portfolio. The variety of products that can be structured demonstrates the difficulty in formulating a single unified definition of a structured product.
Compared to traditional debt or equity instruments, structured products generally yield inferior risk/return profiles, as the issuing brokerage firms—primarily large banks—profit from the spread between investor payouts and the earnings from issuing structured notes, after accounting for broker commissions and fees. Due to the complexity of these products most investors will lack the ability to understand the merits of these investments or compute the probabilities of return versus loss. Some brokers inaccurately market these investments as fixed income or bond-like instruments that return capital. Due to the high risk of loss compared to corporate debt or other fixed income alternatives it would never be appropriate to recommend most structured products as fixed income alternatives.
Recently, firms have begun selling redeemable structured notes often linked to a single investment or a basket of investments. Structured products connected to individual securities demonstrate significant risk without delivering substantial rewards. Our firm reviewed a structured note linked to Peloton’s stock, which offered investors a 1.0625% monthly return (12.75% annually), along with another note connected to Zillow’s stock that promised 12% annual interest paid monthly, provided the stock prices remained above a reference value. The interest payment would only be completely eliminated if both stocks dropped by approximately 40% in value. In addition, if the stocks lost more than approximately 40% of their value then the investor would also lose their corresponding principal based upon the performance of the stocks and could lose their entire investment. Further, the notes were callable and could be cancelled by the sponsor.
These products are very high risk and low reward propositions because the investor can only profit at most by 12-12.75% over the course of one year. Even if Peloton or Zillow doubled in value all the investor could achieve would be the interest payment as their profit and none of the price appreciation. Meanwhile the maximum loss is 100% of the investment if the stocks fell severely. Accordingly, the investor takes dramatic downside risks associated with the volatile stocks while having no chance to participate in the success of the stock.
According to newsources, a study revealed that 7.3% of financial advisors had a customer complaint on their record when records from 2005 to 2015 were examined. Brokers must publicly disclose reportable events on their BrokerCheck reports that include customer complaints, IRS tax liens, judgments, investigations, terminations, and criminal cases.
James entered the securities industry in 1987. James has been registered as a Broker with J.w. Cole Financial, INC. since 2023.
Investors who have suffered losses are encouraged to contact us at (800) 810-4262 for consultation. At Gana Weinstein LLP, our attorneys are experienced representing investors who have suffered securities losses due to the mishandling of their accounts. Claims may be brought in securities arbitration before FINRA. Our consultations are free of charge and the firm is only compensated if you recover.