According to records kept by The Financial Industry Regulatory Authority (FINRA) financial advisor Jeffrey Leach (Leach), currently employed by Morgan Stanley has been subject to at least three customer complaints during the course of his career. Leach’s customer complaints alleges that Leach recommended unsuitable investments in various investments including energy related investments. The clients make allegations including breach of misrepresentation among other allegations of misconduct relating to the handling of their accounts.
In May 2020 a customer complained that Leach violated the securities laws by alleging that Leach made investments recommendations that the client were unsuitable with respect to investments in energy sector from July 2014 to May 2020. The claim alleges $500,000 in damages and is currently pending.
In January 2020 a customer complained that Leach violated the securities laws by alleging that Leach made investments recommendations that the client were misrepresented from September 2018 to December 2019. The claim alleges $3,000,000 in damages and is currently pending.
The investment attorneys of Gana Weinstein LLP are investigating investor claims of unsuitable investments in oil and gas related products. The oil and gas market has been in a constant state of decline since 2014 resulting in the bankruptcy and financial struggles of many oil related companies. Investments in oil and commodities, especially oil and commodity exploration companies, are by their nature cyclical. While the price of oil fluctuates greatly, since the 1970s and factoring inflation oil stays in the $40-$60 a barrel most of the time. The exceptions being periodic but limited duration swings higher and lower than that amount that eventually return to the mean. Comparatively, the S&P 500 returns 11.41% a year and about 8.4% adjusted for inflation. Consequently, there is little reason for advisors to recommend high concentrations in oil related companies given the cyclical and mean reverting nature of oil and gas investments.
Financial advisors must ensure that the oil and gas and commodities related investments being recommended to their client is appropriate for the investor and conduct due diligence on the company before making the recommendation. Unfortunately, sometimes adivsors fail to conduct sufficient research or 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.
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 show 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.
Leach entered the securities industry in 1999. Since June 2009 Leach has been associated with Morgan Stanley out of the firm’s Naples, 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.