Articles Tagged with MLPs

shutterstock_19498822-200x300The law offices of Gana LLP continue to report on investor related losses and potential legal remedies due to recommendations to investor in oil and gas and commodities related investments.  According to BrokerCheck records, customers have filed about ten complaints with the Financial Industry Regulatory Authority’s (FINRA) against broker Regan Rohl (Rohl), a registered representative with Wells Fargo Advisors Financial Network, LLC (Wells Fargo) out of the firm’s Fargo, North Dakota office location.

Many of the customer complaints against Rohl allege a number of securities law violations including that the broker made unsuitable investments and overcenoncetrated clients in oil & gas related investments among other claims.  The most recent complaint was filed in August 2017 and alleged Rohl recommended an unsuitable portfolio over concentrated in energy sector investments and to hold these investments after they began to decline in value causing $75,000.  The claim is currently pending.

In July 2017 another customer filed a complaint alleging $150,000 in damages.  The claim is currently pending.  In June 2017 a customer alleged that from April 2011 through December 2016, Rohl made unsuitable investment recommendations to buy and concentrate their portfolio of four accounts into oil and gas sector master limited partnerships and closed end funds causing $1,500,000 in damages.  The claim is currently pending.

Continue Reading

shutterstock_138129767-300x199The securities lawyers of Gana LLP are investigating customer complaints filed with The Financial Industry Regulatory Authority’s (FINRA) against broker Margaret Lech-Loubet (Lech-Loubet).  According to BrokerCheck records Lech-Loubet has been in the securities industry for 25 years and has two customer complaints on her record.  Lech-Loubet is currently registered with UBS Financial Services, Inc. (UBS) out of the firm’s Beverly Hills, California office location.  The most recent customer complaints against Lech-Loubet alleges that Lech-Loubet concentrated the client in energy related structured products and master limited partnerships (MLPs).

The most recent complaint was filed in January 2017 and alleged that from June 2014 to November 2015 the investments were not suitable and were told the investments were safer than equities.  The customer is claiming $285,582 in damages.  The claim is currently pending.

Continue Reading

shutterstock_103681238The law offices of Gana LLP are announcing their investigation into potential securities claims against brokerage firms over sales practices related to the recommendation of exchange traded notes (ETNs) and other structured notes linked to oil & gas and commodities. These products are issued by UBS (NYSE:UBS) under the name ETRACS.

List of Commodity and Oil & Gas releated ETNs

Symbol           Fund Name

DJCI                ETRACS Bloomberg Commodity Index Total Return ETN

UBG                ETRACS CMCI Gold Total Return ETN

UBM              ETRACS CMCI Industrial Metals Total Return ETN

UBN               ETRACS CMCI Energy Total Return ETN

UCI                 ETRACS CMCI Total Return ETN

UCIB               ETRACS CMCI Total Return ETN Series B

USV                ETRACS CMCI Silver Total Return ETN

AMU               ETRACS Alerian MLP Index ETN

AMUB            ETRACS Alerian MLP Index ETN Series B

FMLP             ETRACS Wells Fargo® MLP Ex-Energy ETN

LMLP             ETRACS Monthly Pay 2xLeveraged Wells Fargo MLP Ex-Energy ETN

MLPB             ETRACS Alerian MLP Infrastructure Index ETN Series B

MLPG             ETRACS Alerian Natural Gas MLP Index ETN

MLPI               ETRACS Alerian MLP Infrastructure Index ETN

MLPL             ETRACS 2xMonthly Leveraged Long Alerian MLP Infrastructure Index ETN

MLPS             ETRACS 1xMonthly Short Alerian MLP Infrastructure Total Return Index ETN

MLPV             ETRACS 2xMonthly Leveraged S&P MLP Index ETN

MLPW            ETRACS Wells Fargo MLP Index ETN

Our offices continue to report on investment losses suffered by investors in energy, commodities, and oil and gas related investments that brokerage firms have increasingly recommended to retail investors in recent years. According to Bloomberg, U.S. high-yield debt issued to junk-rated energy companies grew four-fold to $208 billion. Most of these companies are now struggling to stay afloat with oil prices at $45. Investors have been exposed to energy investments through a variety of investment vehicles including private placements, master limited partnerships (MLPs), leveraged ETFs, mutual funds, and even individual stocks.

Continue Reading

shutterstock_172154582The law offices of Gana LLP are currently investigating brokerage firms that placed investors in oil and gas related investments and who have suffered losses as a result. One company under investigation is Miller Energy Resources Inc. (Stock Symbol: MILL). According to a Wall Street Journal article, creditors of Miller’s Cook Inlet Energy LLC subsidiary filed an involuntary chapter 11 petition claiming about $2.8 million in debts owed.

The involuntary bankruptcy filing comes shortly after the Securities and Exchange Commission (SEC) accused the company of a valuation related accounting fraud. The SEC alleged that Miller Energy acquired oil and gas properties in Alaska in late 2009 for $2.5 million and then allegedly overstated the value of its holdings by more than $400 million in order to boost the company’s net income and assets.

The SEC’s complaint charged Miller Energy, its former chief financial officer and its current chief operating officer for allegedly inflating values of oil and gas properties. The alleged scheme had the effect of taking Miller Energy from a penny stock into a security that was listed on the New York Stock Exchange reaching a $9 per share high in 2013. Trading in Miller Energy was suspended at the end of July. Miller Energy stated that the SEC’s civil action is related to alleged valuation errors from five years ago and the action is not warranted by the facts or the law.

Our offices continue to report on investment losses suffered by investors in energy and oil and gas related investments that brokerage firms have increasingly recommended to retail investors in recent years. Investors have been exposed to energy investments through a variety of investment vehicles including private placements, master limited partnerships (MLPs), leveraged ETFs, mutual funds, and even individual stocks.

Continue Reading

shutterstock_20354401The law offices of Gana LLP are currently investigating brokerage firms that placed investors in oil and gas related investments and who have suffered losses as a result.  Two companies that appear vulnerable include Linn Energy (Stock Symbol: LINE) and Energy XXI Ltd. (Stock Symbol: EXXI). While these companies have not yet declared bankruptcy their stock prices have fallen by well over 90% in the last year.

Many oil companies rely on borrowing lines of credit from banks in order to make investments in their business operations. Some of these lines of credit will come up for renewal on October 1. At which time, according to TheStreet.com banks will look back at the last twelve months to the average price of oil which stood at about $45. This will cause the banks then to reduce the amount of money available to borrow in half compared to a year ago. Due to the reduced credit and access to capital it will become very difficult for companies like Linn Energy and Energy XXI to continue investing and drilling.

For instance Linn Energy and Energy XXI have already exhausted more than 75% of the credit available to them and may be forced in bankruptcy.

Our offices continue to report on investment losses suffered by investors in energy and oil and gas related investments that brokerage firms have increasingly recommended to retail investors in recent years. Investors have been exposed to energy investments through a variety of investment vehicles including private placements, master limited partnerships (MLPs), leveraged ETFs, mutual funds, and even individual stocks.

Oil and gas and commodities related investments have been recommended by brokers under the assumption that commodities prices would continue to go up. However, due to a combination of forces including slack demand in China and the strengthening dollar, last summer the price of oil & gas plummeted and remains around $40 to this day. Some experts are saying that if production volume continues to be as high as it currently is and demand growth weak that the return to $100 a barrel is years away.

Continue Reading

shutterstock_115971289The attorneys at Gana LLP have been following the collapse of a series of mutual funds managed by Cushing Asset Management. The funds involved include:

Cushing Closed-End Funds

Cushing Renaissance Fund

Cushing Royalty & Income Fund

Cushing MLP Total Return Fund

Mainstay Cushing Mutual Funds

MainStay Cushing MLP Premier Fund

MainStay Cushing Royalty Energy Income Fund

MainStay Cushing Renaissance Advantage Fund

(Cushing Funds). Over the past year the value of the Cushing Funds have plummeted between 20-80% in value and may drop further. Indeed, in the past month alone the funds dropped between 7-20% in value. The Cushing Funds typically describe their investment strategy as investing primarily in securities of energy-related U.S. royalty trusts, Canadian royalty trusts, and Canadian exploration and production (E&P), E&P master limited partnerships (MLPs), and securities of other companies in the same businesses as Energy Trusts and MLPs engage.

Cushing Funds were underwritten by broker-dealers including: Stifel, Nicolaus & Company, RBC Capital Markets, Oppenheimer & Co., Robert W. Baird & Co., BB&T Capital Markets, a division of Scott & Stringfellow, Ladenburg Thalmann & Co., Wunderlich Securities, and Maxim Group.

Another surprising feature of these funds are the cost of ownership for investors. For instance the Cushing Royalty & Income Fund resulted in investor costs of 4.50% sales load fee if they invested at the IPO. Additional underwriting fees brought the total fee for IPO investors up to 6.15%. In addition, every year, the fund expects to charge investors 3.09% in fees for management and other expenses. Such fees and costs are highly unreasonable in light of cheaper alternatives.

Continue Reading

shutterstock_22722853The law offices of Gana LLP are currently investigating investors who have suffered losses in in now bankrupt oil and gas company, American Eagle Energy Corp. (Stock Symbols: AMZG) (American Eagle Energy). American Eagle Energy is a Colorado, Littleton-based company that buys and develops wells in the Williston Basin of North Dakota. American Eagle Energy filed for chapter 11 bankruptcy in May 2015.

Our offices continue to report on investment losses suffered by investors in various oil and gas investments that brokerage firms have increasingly recommended to retail investors in recent years. These investments include private placements, master limited partnerships (MLPs), leveraged ETFs, mutual funds, and even individual stocks.

Oil and gas related investments have been recommended by brokers under the assumption that oil & gas would continue to be sold at around $100 and increase steadily over time. However, last summer the price of oil & gas plummeted due to a strengthening dollar and increased global supply of oil and remains below $60 to this day. Some experts are saying that if production volume continues to be as high as it currently is and demand growth weak that the return to $100 a barrel is years away.

Before recommending investments in oil and gas companies, 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.

In the case of oil and gas investments, many of these companies, such as American Eagle Energy, took on enormous amounts of debt in order to engage in exploration activities that could only make sense if the price of oil remained high. As reported by the Wall Street Journal the drop in oil prices and the industry downturn has made it difficult for the company to refinance its debts.

Continue Reading

shutterstock_836360The law offices of Gana LLP are currently investigating investors who have suffered losses in in now bankrupt oil and gas company, BPZ Resources, Inc. (BPZ Resources) (Stock Symbols: BPZRQ and BPZ)  BPZ Resources is an independent oil and gas exploration and production company with license contracts covering approximately 1.9 million net acres in four properties in northwest Peru. BPZ Resources filed for chapter 11 bankruptcy in March 2015.

Our offices continue to report on investment losses suffered by investors in various oil and gas investments that brokerage firms have increasingly recommended to retail investors in recent years. These investments include private placements, master limited partnerships (MLPs), leveraged ETFs, mutual funds, and  individual stocks. See Overconcentrated in Oil and Gas Investments?, MLP Fund MainStay Cushing Royalty Energy Hurt by Failing Oil & Gas Prices; Oil and Gas Investments – Issuers Profit While Investors Take All the Risk, BlackGold Opportunity Fund Investors Suffer Losses

Oil and gas related investments have been recommended by brokers under the assumption that oil & gas would continue to be sold at around $100 and increase steadily over time. However, last summer the price of oil & gas plummeted due to a strengthening dollar and increased global supply of oil and remains below $60 to this day. Some experts are saying that if production volume continues to be as high as it currently is and demand growth weak that the return to $100 a barrel is years away.

Before recommending investments in oil and gas companies, 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.

Continue Reading

shutterstock_168737270Long time readers of this blog know that we have previously reported that brokerage firms have increasingly recommended that retail investors invest heavily in various types of oil & gas investments including private placements, master limited partnerships (MLPs), leveraged ETFs, mutual funds, and even individual stocks. See Overconcentrated in Oil and Gas Investments?, MLP Fund MainStay Cushing Royalty Energy Hurt by Failing Oil & Gas Prices; Oil and Gas Investments – Issuers Profit While Investors Take All the Risk

For instance, MLPs are publicly traded partnerships where about 86% of approximately 130 MLP securities, a $490 billion sector, can be attributed to energy and natural resource companies. Billions more have been raised in the private placement market. These oil and gas private placements suffer from enormous risks that often outweigh any potential benefits including securities fraud, conflicts of interests, high transaction / sales costs, and investment risk.

These investments have been recommended by brokers under the assumption that oil & gas would continue to be sold at around $100 and increase steadily over time. However, last summer the price of oil & gas plummeted due to a strengthening dollar and increased global supply of oil and remains below $60 to this day. Some experts are saying that if production volume continues to be as high as it currently is and demand growth weak that the return to $100 a barrel is years away.

In addition, several companies have recently been accused of making false statements in order to promote their stock price through these turbulent times triggering class action complaints. Two such companies are Cobalt International (Cobalt) and Seadrill Limited (Seadrill).

According to the allegations, Cobalt was supposed to operate in compliance with U.S. laws prohibiting the bribery of foreign officials. However, the complaint alleges that Cobalt gained access to its oil wells in Angola by partnering with certain shell companies that were in part owned by high-level Angolan officials. This action placed Cobalt at risk of an enforcement action by the SEC and Department of Justice for violating the Foreign Corrupt Practices Act. In addition, the class action complaint alleges that Cobalt overstated the value of these Angola wells after it learned that they contained little or no oil. Accordingly, Cobalt’s stock price has plummeted over the last year.

Continue Reading