Securities Lawyer

Morgan Stanley Broker Edward Barger has Four Customer Complaints

May 17, 2016 | by Staff Attorney

The securities lawyers of Gana Weinstein LLP are investigating customer complaints filed with The Financial Industry Regulatory Authority (FINRA) against broker Edward Barger (Barger). According to BrokerCheck records Barger has been subject to at least four customer complaints, two regulatory action, and one criminal matter. The customer complaints against Barger allege securities law violations that including unsuitable investments among other claims.

In April 2016, a customer complained that Barger made unsuitable investments in his account from August 2011 until December 2015. In May 2015, another customer alleged that Barger made unsuitable investments in the account from February 2011 until December 2014 causing damages of $300,000.

Brokers have a responsibility treat investors fairly which includes obligations such as making only suitable investments for the client. In order to make a suitable recommendation the broker must meet certain requirements. First, there must be reasonable basis for the recommendation the product or security based upon the broker’s investigation and due diligence into the investment’s properties including its benefits, risks, tax consequences, and other relevant factors. Second, the broker then must match the investment as being appropriate for the customer’s specific investment needs and objectives such as the client’s retirement status, long or short term goals, age, disability, income needs, or any other relevant factor.

Customer Complaints Against Financial Advisor Michael Stern

April 27, 2016 | by Staff Attorney

The securities lawyers of Gana Weinstein LLP are investigating customer complaints filed with The Financial Industry Regulatory Authority (FINRA) against broker Michael Stern (Stern). According to BrokerCheck records Stern has been subject to at least eight customer complaints. The customer complaints against Stern alleges securities law violations that including unsuitable investments, fraud, and breach of fiduciary duty among other claims.

In June 2015 a customer filed a complaint alleging $1,000,000 in damage stemming from negligence and breach of fiduciary duty. The complaint is pending.

Brokers have a responsibility treat investors fairly which includes obligations such as making only suitable investments for the client. In order to make a suitable recommendation the broker must meet certain requirements. First, there must be reasonable basis for the recommendation the product or security based upon the broker’s investigation and due diligence into the investment’s properties including its benefits, risks, tax consequences, and other relevant factors. Second, the broker then must match the investment as being appropriate for the customer’s specific investment needs and objectives such as the client’s retirement status, long or short term goals, age, disability, income needs, or any other relevant factor.

Customers File Suitability Complaints Against Merrill Lynch Advisor Lisa Wolf

April 25, 2016 | by Staff Attorney

The securities lawyers of Gana Weinstein LLP are investigating customer complaints filed with The Financial Industry Regulatory Authority (FINRA) against broker Lisa Wolf (Wolf). According to BrokerCheck records Wolf has been subject to at least six customer complaints. The customer complaints against Wolf allege securities law violations that including unsuitable investments, unauthorized trading, misrepresentations, and excessive trading among other claims.

In April 2015 a customer filed a complaint alleging $364,630 in damage stemming from unauthorized trades and unsuitable investment recommendations from July 2008 through June 2014. The complaint is currently pending. In May 2013, another customer filed a complaint alleging unsuitable investments from May 2008 through March 2009 causing $220,000. The claim settled.

Brokers have a responsibility treat investors fairly which includes obligations such as making only suitable investments for the client. In order to make a suitable recommendation the broker must meet certain requirements. First, there must be reasonable basis for the recommendation the product or security based upon the broker’s investigation and due diligence into the investment’s properties including its benefits, risks, tax consequences, and other relevant factors. Second, the broker then must match the investment as being appropriate for the customer’s specific investment needs and objectives such as the client’s retirement status, long or short term goals, age, disability, income needs, or any other relevant factor.

Financial Advisor Roman Reed Discharged From Merrill Lynch Over Customer Complaint

April 23, 2016 | by Staff Attorney

The securities lawyers of Gana Weinstein LLP are investigating customer complaints filed with The Financial Industry Regulatory Authority (FINRA) against broker Roman Reed (Reed). According to BrokerCheck records Reed has been subject to at least four customer complaints. The customer complaints against Reed allege securities law violations that including unsuitable investments and unauthorized trading among other claims.

In February 2015 Merrill Lynch, Pierce, Fenner & Smith Incorporated (Merrill Lynch) discharged Reed for cause stating that the reason related to the broker’s handling of a customer complaint. In April 2014 a customer filed a complaint alleging $1,153,803 in damage stemming from the Reed conducting unauthorized trades from March 2011 through January 2014.

Brokers have a responsibility treat investors fairly which includes obligations such as making only suitable investments for the client. In order to make a suitable recommendation the broker must meet certain requirements. First, there must be reasonable basis for the recommendation the product or security based upon the broker’s investigation and due diligence into the investment’s properties including its benefits, risks, tax consequences, and other relevant factors. Second, the broker then must match the investment as being appropriate for the customer’s specific investment needs and objectives such as the client’s retirement status, long or short term goals, age, disability, income needs, or any other relevant factor.

Investors File Excessive Trading Complaints Against Legend Securities Broker Bernardo Misseri

April 11, 2016 | by Staff Attorney

The securities fraud lawyers of Gana Weinstein LLP are investigating customer complaints filed with The Financial Industry Regulatory Authority’s (FINRA) against broker Bernardo Misseri (Misseri). According to BrokerCheck records Misseri has been the subject of at least seven customer complaints, five judgements or liens, and two regulatory actions. The customer complaints against Misseri allege a number of securities law violations including that the broker made unsuitable investments, unauthorized trading, fraud, misrepresentations, and churning (excessive trading) among other claims. In addition, there are two regulatory claims against Misseri. One by the state of Illinois filed in June 2010 that suspended the broker for two years. Another action was filed by the NASD in 2005 alleging that Misseri effected private securities transactions away from his firm by soliciting certain limited partnerships.

Misseri has disclosed several large tax liens including a $6,746 in March 2015, a tax lien of $7,662 in February 2015, a $37,847 tax lien in November 2014, a $11,884 tax lien in June 2014, and a $217,156 tax lien in August 2013. Substantial judgements and liens on a broker’s record can reveal a financial incentive for the broker to recommend high commission products or services. A broker’s inability to handle their personal finances has also been found to be relevant in helping investors determine if they should allow the broker to handle their finances.

When brokers engage in excessive trading, sometimes referred to as churning, the broker will typical trade in and out of securities, sometimes even the same stock, many times over a short period of time. Often times the account will completely “turnover” every month with different securities. This type of investment trading activity in the client’s account serves no reasonable purpose for the investor and is engaged in only to profit the broker through the generation of commissions created by the trades. Churning is considered a species of securities fraud. The elements of the claim are excessive transactions of securities, broker control over the account, and intent to defraud the investor by obtaining unlawful commissions. A similar claim, excessive trading, under FINRA’s suitability rule involves just the first two elements. Certain commonly used measures and ratios used to determine churning help evaluate a churning claim. These ratios look at how frequently the account is turned over plus whether or not the expenses incurred in the account made it unreasonable that the investor could reasonably profit from the activity.

Broker Investigation: William Berg Unsuitable Oil and Gas Investments

March 11, 2016 | by Staff Attorney

The investment attorneys of Gana Weinstein LLP are investigating investor claims of unsuitable investments in oil and gas related products. Our firm is currently representing a number of investors who lost substantial savings due to poor advice to concentrate holdings in speculative commodities investments like master limited partnerships (MLPs). According to Brokercheck records, William Berg (Berg) with Wells Fargo Advisors, LLC (Wells Fargo) has recently received a customer complaint alleging overconcentrated positions in oil and gas equities.

As a background, MLPs are publicly traded partnerships. About 86% of the total MLP securities market, a $490 billion sector, can be attributed to energy and natural resource companies. There are about 130 MLPs trading on major exchanges that focus on energy related industries and natural resources.

Wall Street loves MLPs because they provide high yields to investors and require companies to pay Wall Street in order to continue to grow. In 2013 banks earned fees of $890.3 million from MLP issuance. Bloomberg quoted an analyst stating that “MLPs are Wall Street’s dream,” because “[t]hey’re fee machines.” Naturally, in order to entice investors to continue to invest in MLPs Wall Street pumps up MLPs every chance they get. According to Bloomberg, in May 2014 “[a]nalysts predict that 93 of the 114 MLPs in existence will rise in value in the next year…” Astonishingly, “all but five MLPs are recommended by the majority of the analysts who cover them.” At that time professionals without conflicts called MLPs “the next great investment debacle” and warned that “many MLP shareholders…may not understand what they’ve gotten into.”

Plains All American Pipeline (PAA) Investor Recovery Options

February 27, 2016 | by Staff Attorney

The investment attorneys with Gana Weinstein LLP continue to report on investor related losses in oil and gas and commodities related investments. Investors may have potential legal remedies due to unsuitable recommendations by their broker to invest in this speculative and volatile area. Our firm represents securities investors in claims against brokerage firms over sales practices related to the recommendations of oil & gas and commodities products such as exchange traded notes (ETNs), structured notes, private placements, master limited partnerships (MLPs), leveraged ETFs, mutual funds, and individual stocks.

Among the MLPs that have suffered significant declines is Plains All American Pipeline, L.P. (NYSE:PAA). Plains All American Pipeline has plummeted in value by about 67% in value over the last year. According to the company’s website, Plains All American Pipeline engages in the transportation, storage, terminalling, and marketing of crude oil and refined products. Plains All American Pipeline also is in the business of storage of natural gas, processing, transportation, fractionation, storage, and marketing of natural gas liquids.

As a background, about 86% of the total MLP securities market, a $490 billion sector, can be attributed to energy and natural resource companies. In the past year, investors have lost $20 billion in publicly traded in master limited partnerships, publicly traded oil funds. This amounts to an astonishing $8 of every $10 they had invested, according to a report prepared for The Associated Press article. The research does not include losses from $37 billion of bonds sold by the partnerships in the five years since 2010 or losses from private placement partnerships. However, banks like Citigroup, Barclays, and Wells Fargo made an estimated $1.1 billion in fees for selling these products to investors.

Broker Spotlight: Centaurus Financial Advisor Marcious Dickerson

February 25, 2016 | by Staff Attorney

The securities lawyers of Gana Weinstein LLP are investigating customer complaints filed with The Financial Industry Regulatory Authority (FINRA) against broker Marcious Dickerson (Dickerson). According to BrokerCheck records Dickerson has been the subject of 3 customer complaints. The customer complaints against Dickerson allege securities law violations that including unsuitable investments, misrepresentations, and breach of fiduciary duty among other claims. Many of the most recent claims involve allegations concerning non traded real estate investment trusts (Non-Traded REITs).

As a background since the mid-2000s Non-Traded REITs became one of Wall Street’s hottest products. However, the failure of Non-Traded REITs to perform as well as their publicly traded counterparts has called into question if Non-Traded REITs should be sold at all and if so should there be a limit on the amount a broker can recommend. See Controversy Over Non-Traded REITs: Should These Products Be Sold to Investors? Part I

Non-Traded REITs are securities that invest in different types of real estate assets such as commercial, residential, or other specialty niche real estate markets such as strip malls, hotels, storage, and other industries. Non-traded REITs are sold only through broker-dealers, are illiquid, have no or limited secondary market and redemption options, and can only be liquidated on terms dictated by the issuer, which may be changed at any time and without prior warning.

Broker Investigation: National Securities Advisor Kyle Harrington

February 16, 2016 | by Staff Attorney

The securities lawyers of Gana Weinstein LLP are investigating customer complaints filed with The Financial Industry Regulatory Authority (FINRA) against broker Kyle Harrington (Harrington). According to BrokerCheck records Harrington has been subject to 6 customer complaints, one regulatory action, one employment separation, and one financial disclosure. The customer complaints against Harrington allege securities law violations that including misrepresentations, breach of fiduciary duty, and negligence among other claims. The regulatory finding was made by FINRA which alleged that Harrington failed to disclose certain information that had to be disclosed on Harrington’s Form U4. The employment separation by Matrix Capital Group, Inc. (Matrix) also concerns allegations of failure to disclose reportable information.

Brokers have a responsibility treat investors fairly which includes obligations such as making only suitable investments for the client. In order to make a suitable recommendation the broker must meet certain requirements. First, there must be reasonable basis for the recommendation the product or security based upon the broker’s investigation and due diligence into the investment’s properties including its benefits, risks, tax consequences, and other relevant factors. Second, the broker then must match the investment as being appropriate for the customer’s specific investment needs and objectives such as the client’s retirement status, long or short term goals, age, disability, income needs, or any other relevant factor.

The number of events listed on Harrington brokercheck is high relative to his peers. According to InvestmentNews, only about 12% of financial advisors have any type of disclosure event on their records. Brokers must publicly disclose certain types of reportable events on their CRD including but not limited to customer complaints. In addition to disclosing client disputes brokers must divulge IRS tax liens, judgments, and criminal matters. However, FINRA’s records are not always complete according to a Wall Street Journal story that checked with 26 state regulators and found that at least 38,400 brokers had regulatory or financial red flags such as a personal bankruptcy that showed up in state records but not on BrokerCheck. More disturbing is the fact that 19,000 out of those 38,400 brokers had spotless BrokerCheck records.

Mutual Fund Kayne Anderson MLP Investor Recovery Options (KYN)

February 11, 2016 | by Staff Attorney

The investment attorneys with Gana Weinstein LLP continue to report on investor related losses in oil and gas and commodities related investments. Investors may have potential legal remedies due to unsuitable recommendations by their broker to invest in this speculative and volatile area. Our firm has been tracking a number of leveraged Master Limited Partnership (MLP) closed-end funds that have suffered significant losses. Among those funds is Kayne Anderson MLP (NYSE:KYN), with $4.1 billion in assets. Over the past year the fund has suffered a 57% loss.

As a background, about 86% of the total MLP securities market, a $490 billion sector, can be attributed to energy and natural resource companies. In the past year, investors have lost $20 billion in publicly traded in master limited partnerships, publicly traded oil funds. This amounts to an astonishing $8 of every $10 they had invested, according to a report prepared for The Associated Press article. The research does not include losses from $37 billion of bonds sold by the partnerships in the five years since 2010 or losses from private placement partnerships. However, banks like Citigroup, Barclays, and Wells Fargo made an estimated $1.1 billion in fees for selling these products to investors.

Our clients tell us similar stories that their advisors hyped MLPs as high yielding investments without significant discussion of risk. In a recent Associated Press article, common stories of how investors are pitched by their financial advisors on oil and gas private placements were reported on. Often times these products are pitched as ways to ride the boom in U.S. oil and gas production and receive steady streams of income.