Securities Lawyers Blog
The law offices of Gana Weinstein 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 seven complaints with the Financial Industry Regulatory Authority’s (FINRA) against broker Jeffrey Grayson (Grayson), a former registered representative with Wells Fargo Advisors (Wells Fargo) out of the firm’s Florham Park, New Jersey office location.
Some of the customer complaints against Grayson 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 June 2017 and alleged unauthorized trading and unsuitable investments. The complaint is currently pending.
In February 2017 FINRA suspended Grayson alleging that Grayson exercised discretion in four accounts without written authorization from those customers and without having obtained approval from his member firm to treat those customer accounts as discretionary. FINRA also found that Grayson provided inaccurate responses about his use of discretion on the firm’s annual compliance documents.
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.
The number of complaints against Grayson 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.
Grayson entered the securities industry in 1981. Since April 2011 Grayson has been associated with Wells Fargo.
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. Investors who have suffered losses may be able recover their losses through securities arbitration. Our consultations are free of charge and the firm is only compensated if you recover.