Securities Lawyers Blog
Morgan Stanley financial advisor Michael Fitz-Gerald (Fitz-Gerald) has subject to five customer complaints according to BrokerCheck records. Fitz-Gerald has been employed with Morgan Stanley since November 2008. According to BrokerCheck the most recent customer complaints allege unsuitable investments and failure to diversify the portfolio among other claims.
The most recent complaint was filed in February 2017 and alleges investments in energy stocks since 2014 were unsuitable and did not specify damages. The claim is currently pending. In February 2016 another customer filed a complaint alleging $50,000 in damages as a result of a failure to diversify the portfolio. The claim was settled. The securities lawyers of Gana Weinstein LLP continue to investigate the customer complaints against Fitz-Gerald.
Our firm is currently tracking a number of brokers that severely concentrated their clients in the oil and gas and commodities sectors which has historically possessed speculative risks due to the volatile nature of commodities prices. Before making such recommendations, 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 and the volatile nature of commodities.
One highly recommended product in recent years have been master limited partnerships (MLPs). 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.” Further, Wall Street showered MLPs with favorable research coverage to promote the boom. 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.”
The number of complaints against Fitz-Gerald 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.
Fitz-Gerald entered the securities industry in 1969. Since November 2008 Fitz-Gerald has been associated with Morgan Stanley out of the firm’s San Francisco, California office location.
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.