Securities Lawyers Blog
The securities attorneys at Gana Weinstein LLP are investigating claims against Packerland Brokerage Services, Inc. (Packerland Brokerage) broker Edward Davig (Davig).
According to BrokerCheck records, Davig has been subject to six customer complaints, one of which is still pending. The majority of these customer complaints involve unsuitable recommendations in oil and gas securities.
In April 2018, a customer alleged that Davig recommended the client to invest in unsuitable, illiquid oil and gas Master Limited Partnership investment which generated many losses for the client. The client has requested $500,000 for damages. This dispute is still pending.
Our firm is investigating potential securities 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.
Before recommending investments in oil and gas and commodities related investments, brokers and advisors must ensure that the investment is appropriate for the investor and conduct due diligence on the company in order to understand the risks and prospects of the company. Oil and gas and commodities related investments have been recommended by brokers under the assumption that commodities prices would continue to go up. However, brokers who sell oil and gas and commodities products are obligated to understand the risks of these investments and convey them to clients.
Brokers are required to advise suitable investments for the customer by following certain criteria. First, there must be reasonable basis for the recommendation the product or security based upon the broker’s research 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 complaints against Davig are unusual compared to his peers. According to newsources, only about 7.3% of financial advisors have any type of disclosure event on their records among brokers employed from 2005 to 2015. Brokers must publicly disclose reportable events on their CRD customer complaints, IRS tax liens, judgments, investigations, and even criminal matters. However, studies have found that there are fraud hotspots such as certain parts of California, New York or Florida, where the rates of disclosure can reach 18% or higher. Moreover, according to the New York Times, BrokerCheck may be becoming increasing inaccurate and understate broker misconduct as studies have shown that 96.9% of broker requests to clean their records of complaints are granted.
Davig entered the securities industry in 1977 and has been registered with Packerland Brokerage since 2008. From 1998 to 2008, Davig was a registered representative with Triad Advisors, Inc.
Investors who have suffered losses may be able recover their losses through securities arbitration. The attorneys at Gana Weinstein LLP are experienced in representing investors from brokerage firms failure to supervise their representatives. Our consultations are free of charge and the firm is only compensated if you recover.