Securities Lawyers Blog
The law offices of Gana Weinstein LLP are currently investigating claims against advisor Ian M. Deliz Morales (Deliz), formerly registered with Morgan Stanley out of Tampa, Florida. According to a BrokerCheck report, Deliz has been subject to at least 22 customer disputes, 13 of which are still pending. In addition, Deliz disclosed a $169,324 tax lien against him. According to records kept by The Financial Industry Regulatory Authority (FINRA), the majority of these disputes concern violations of securities laws regarding unsuitable investments of Puerto Rico bonds and closed-end funds.
Most recently, in June 2019, a client alleged that Deliz violated the securities laws by recommending unsuitable investments in Puerto Rico bonds causing $315,000 in damages. This dispute is currently still pending.
In July 2017 a customer filed a complaint alleging that Deliz made unsuitable recommendations to hold Puerto Rico bonds in an over-concentrated manner. The complaint alleged $1 million in damages and was settled for $275,000.
Brokers have recommended Puerto Rico bonds over the past decade as an attractive high yielding investment that is triple-tax free – meaning interest earned is free of federal, state, or local taxes. But brokers in the financial industry have to understand more than just the yield on a bond and its tax benefits. Brokers must make recommendations that are suitable 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.
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. In addition, research has shown a disturbing pattern with troublesome brokers where brokers with high numbers of customer complaints are not kicked out of the industry but instead these brokers are sifted to lower quality brokerage firms with loose hiring practices and higher rates of customer complaints. These lower quality firms may average brokers with five times as many complaints as the industry average.
Deliz entered the securities industry in 2003. From December 2007 through July 2014, Deliz was registered with Popular Securities, LLC. From July 2014 until October 2016, Deliz was registered with Morgan Stanley out of the firm’s Tampa, Florida office location.
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.