oil and gas investment

Gana LLP Files Complaint on Behalf of Investor Alleging Breach of Fiduciary Duty in the Sale of MLPs Against Wells Fargo

March 13, 2016 | by Staff Attorney

The investment attorneys of Gana Weinstein LLP have brought a claim on behalf of an investor who suffered a loss of nearly all of their assets due to investments made by their Wells Fargo Advisors, LLC (Wells Fargo) advisor, Andrew Kevlahan (Kevlahan), almost exclusively in master limited partnerships (MLPs), Business Development Corporations (BDC), commodities linked investments, and other private equity high yield funds. The investor is 79 years old and retired with her husband.

The complaint alleges that on or about May 2011, the couple had become completely retired and had a securities backed loan with Wells Fargo secured by their investment account. The complaint alleged that due to these major lifestyle and financial circumstance changes, which were disclosed and known to Kevlahan, the couple’s investment objectives, income needs, and risk tolerance had changed requiring suitable investments that would diversify and protect the couple’s savings.

Instead, the complaint alleges that Kevlahan failed to properly advise the investor and breached his fiduciary duty to his client by continually increasing the concentration of the account in risky high yielding investments. By May 2011, the complaint alleges that concentration of high yield investments and MLPs grew to more than 50% of all of the investor’s assets. Despite the change in life circumstances, the complaint alleges that Kevlahan used his discretionary authority in order to continually increase the amount of risk in the account and by August 2014, the investor had a concentration of 62% of the couple’s assets in MLPs and 18% in other high yield investments – a total of 80% of the couple’s assets were exposed to extreme risk.

Broker Investigation: William Berg Unsuitable Oil and Gas Investments

March 11, 2016 | by Staff Attorney

The investment attorneys of Gana Weinstein LLP are investigating investor claims of unsuitable investments in oil and gas related products. Our firm is currently representing a number of investors who lost substantial savings due to poor advice to concentrate holdings in speculative commodities investments like master limited partnerships (MLPs). According to Brokercheck records, William Berg (Berg) with Wells Fargo Advisors, LLC (Wells Fargo) has recently received a customer complaint alleging overconcentrated positions in oil and gas equities.

As a background, MLPs are publicly traded partnerships. About 86% of the total MLP securities market, a $490 billion sector, can be attributed to energy and natural resource companies. There are about 130 MLPs trading on major exchanges that focus on energy related industries and natural resources.

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.” Naturally, in order to entice investors to continue to invest in MLPs Wall Street pumps up MLPs every chance they get. 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.”

Pacific Coast Oil Trust (ROYT) Investor Loss Recovery

March 9, 2016 | by Staff Attorney

The investment attorneys with Gana Weinstein LLP are investigating and representing investors who were inappropriately recommended oil and gas and commodities related investments. Investors may have potential legal remedies due to unsuitable recommendations by their broker to invest in this speculative and volatile area. One royalty trust that has suffered substantial declines is Pacific Coast Oil Trust (Stock Symbol: ROYT). Since the trust’s inception in May 2012 it has suffered a 95% loss in value.

Pacific Coast Oil Trust is a Delaware statutory trust formed by Pacific Coast Energy Company LP (PCEC) containing interests in California onshore oil properties located in the Santa Maria and Los Angeles Basins. PCEC owns the underlying properties which consist of proved developed reserves and other development potential on the underlying properties most of which is oil and natural gas related production.

Oil and gas royalty trusts, like master limited partnerships (MLPs), invest in the energy and commodities sector. However, unlike MLPs, royalty trusts generate income from the actual production of natural resources such as coal, oil, and natural gas and therefore the cash flows from royalty trusts are subject to swings in commodity prices and production levels causing them to be very inconsistent. Royalty trusts have no physical operations, no management, and no employees. Instead, royalty trusts are merely financing vehicles run by banks that trade like stocks. Another company actually mine the resources and pay the royalties to the trust.

Whiting USA Trust II (WHZ) Investor Loss Recovery

March 9, 2016 | by Staff Attorney

The investment attorneys with Gana Weinstein LLP are investigating and representing investors who were inappropriately recommended oil and gas and commodities related investments. Investors may have potential legal remedies due to unsuitable recommendations by their broker to invest in this speculative and volatile area. One royalty trust that has suffered substantial declines is Whiting USA Trust II (Stock Symbol: WHZ). Over the past year the trust has suffered a 95% loss.

Whiting Oil Trust II was created in December of 2011 at the height of the oil market and has since suffered staggering losses as oil has tumbled. Recently, the price of the trust to drop below $1 per unit and was delisted.

Oil and gas royalty trusts, like master limited partnerships (MLPs), invest in the energy and commodities sector. However, unlike MLPs, royalty trusts generate income from the actual production of natural resources such as coal, oil, and natural gas and therefore the cash flows from royalty trusts are subject to swings in commodity prices and production levels causing them to be very inconsistent. Royalty trusts have no physical operations, no management, and no employees. Instead, royalty trusts are merely financing vehicles run by banks that trade like stocks. Another company actually mine the resources and pay the royalties to the trust.

EnLink Midstream Partners, LP (ENLK) Investor Recovery Options

March 7, 2016 | by Staff Attorney

The investment attorneys with Gana Weinstein LLP continue to report on investor related losses in oil and gas and commodities related investments. Investors may have potential legal remedies due to unsuitable recommendations by their broker to invest in this speculative and volatile area.

Among the MLPs that have suffered significant declines is EnLink Midstream Partners, LP (NYSE:ENLK). EnLink Midstream Partners has plummeted in value by about 71% in value over the last year. According to the company’s website, EnLink Midstream Partners has expansive gathering, processing, fractionation, transportation, and logistics assets located in the Barnett, Permian Basin, the Gulf Coast, Eagle Ford, Haynesville, Cana-Woodford, Arkoma-Woodford, Utica, and the Marcellus areas. The company has more than 9,200 miles of gathering and transportation pipelines, 17 processing plants with 3.6 billion cubic feet of net processing capacity, and seven fractionators with 280 million barrels per day of net fractionation capacity. Since the company’s formation in 2014, it has executed approximately $4.3 billion of acquisitions and growth projects.

As a background, The MLP sector had totaled $600 billion in assets at its peak before collapsing to about $300 billion now. According to the Associated Press, investors have lost an astonishing $8 of every $10 they had invested since 2014. The research does not include losses from $37 billion of bonds sold by the partnerships in the five years since 2010 or losses from private placement partnerships. However, banks like Citigroup, Barclays, and Wells Fargo made an estimated $1.1 billion in fees for selling these products to investors.

Mesabi Trust (MSB) Investor Loss Recovery

March 7, 2016 | by Staff Attorney

The investment attorneys with Gana Weinstein LLP are investigating and representing investors who were inappropriately recommended oil and gas and commodities related investments. Investors may have potential legal remedies due to unsuitable recommendations by their broker to invest in this speculative and volatile area. One royalty trust that has suffered substantial declines is Mesabi Trust (Stock Symbol: MSB). Over the past year the trust has suffered a 76% loss.

According to the company’s website, Mesabi Trust is a royalty trust organized in 1961 and derives income from an iron mine from the Peter Mitchell Mine located near Babbitt, Minnesota, at the eastern end of the Mesabi Iron Range. The mine is operated by Northshore Mining Company, a subsidiary of Cleveland-Cliffs Inc.

Oil and gas royalty trusts, like master limited partnerships (MLPs), invest in the energy and commodities sector. However, unlike MLPs, royalty trusts generate income from the actual production of natural resources such as coal, oil, and natural gas and therefore the cash flows from royalty trusts are subject to swings in commodity prices and production levels causing them to be very inconsistent. Royalty trusts have no physical operations, no management, and no employees. Instead, royalty trusts are merely financing vehicles run by banks that trade like stocks. Another company actually mine the resources and pay the royalties to the trust.

Sunoco Logistics Partners L.P. (SXL) Investor Recovery Options

February 29, 2016 | by Staff Attorney

The investment attorneys with Gana Weinstein LLP continue to report on investor related losses in oil and gas and commodities related investments. Investors may have potential legal remedies due to unsuitable recommendations by their broker to invest in this speculative and volatile area. Our firm represents securities investors in 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.

Among the MLPs that have suffered significant declines is Sunoco Logistics Partners (NYSE:SXL). Sunoco Logistics Partners has plummeted in value by about 58% in value over the last year. According to the company’s website, Sunoco Logistics Partners owns and operates a logistics business with a diverse portfolio of crude oil, refined products, and natural gas liquids pipeline, terminalling and acquisition and marketing assets. Sunoco Logistics Partners’ general partner is a consolidated subsidiary of Energy Transfer Partners, L.P. (NYSE: ETP).

As a background, The MLP sector had totaled $600 billion in assets at its peak before collapsing to about $300 billion now. According to the Associated Press, investors have lost an astonishing $8 of every $10 they had invested since 2014. The research does not include losses from $37 billion of bonds sold by the partnerships in the five years since 2010 or losses from private placement partnerships. However, banks like Citigroup, Barclays, and Wells Fargo made an estimated $1.1 billion in fees for selling these products to investors.

ONEOK Partners, L.P. (OKS) Investor Recovery Options

February 27, 2016 | by Staff Attorney

The investment attorneys with Gana Weinstein LLP continue to report on investor related losses in oil and gas and commodities related investments. Investors may have potential legal remedies due to unsuitable recommendations by their broker to invest in this speculative and volatile area. Our firm represents securities investors in 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.

Among the MLPs that have suffered significant declines is ONEOK Partners, L.P. (NYSE:OKS). ONEOK Partners has plummeted in value by about 57% in value over the last two years. According to the company’s website, ONEOK Partners, is one of the largest publicly traded master limited partnerships that owns natural gas liquids systems that connects NGL supply in the Mid-Continent, Permian and Rocky Mountain regions with key market centers. The company claims to be a leader in the gathering, processing, storage and transportation of natural gas in the U.S.

As a background, about 86% of the total MLP securities market, a $490 billion sector, can be attributed to energy and natural resource companies. In the past year, investors have lost $20 billion in publicly traded in master limited partnerships, publicly traded oil funds. This amounts to an astonishing $8 of every $10 they had invested, according to a report prepared for The Associated Press article. The research does not include losses from $37 billion of bonds sold by the partnerships in the five years since 2010 or losses from private placement partnerships. However, banks like Citigroup, Barclays, and Wells Fargo made an estimated $1.1 billion in fees for selling these products to investors.

Plains All American Pipeline (PAA) Investor Recovery Options

February 27, 2016 | by Staff Attorney

The investment attorneys with Gana Weinstein LLP continue to report on investor related losses in oil and gas and commodities related investments. Investors may have potential legal remedies due to unsuitable recommendations by their broker to invest in this speculative and volatile area. Our firm represents securities investors in 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.

Among the MLPs that have suffered significant declines is Plains All American Pipeline, L.P. (NYSE:PAA). Plains All American Pipeline has plummeted in value by about 67% in value over the last year. According to the company’s website, Plains All American Pipeline engages in the transportation, storage, terminalling, and marketing of crude oil and refined products. Plains All American Pipeline also is in the business of storage of natural gas, processing, transportation, fractionation, storage, and marketing of natural gas liquids.

As a background, about 86% of the total MLP securities market, a $490 billion sector, can be attributed to energy and natural resource companies. In the past year, investors have lost $20 billion in publicly traded in master limited partnerships, publicly traded oil funds. This amounts to an astonishing $8 of every $10 they had invested, according to a report prepared for The Associated Press article. The research does not include losses from $37 billion of bonds sold by the partnerships in the five years since 2010 or losses from private placement partnerships. However, banks like Citigroup, Barclays, and Wells Fargo made an estimated $1.1 billion in fees for selling these products to investors.

NuStar Energy L.P. (NS) Investor Recovery Options

February 25, 2016 | by Staff Attorney

The investment attorneys with Gana Weinstein LLP continue to report on investor related losses in oil and gas and commodities related investments. Investors may have potential legal remedies due to unsuitable recommendations by their broker to invest in this speculative and volatile area. Our firm represents securities investors in 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.

Among the MLPs that have suffered significant declines is NuStar Energy L.P. (NYSE:NS). NuStar Energy has plummeted in value by 54% in value over the last year. According to the company’s website, NuStar Energy has an enterprise value of around $6 billion and based in San Antonio, TX. NuStar has approximately 8,700 miles of pipeline and 79 terminal and storage facilities that store and distribute crude oil and other refined products. NuStar Energy has operations in the United States, Canada, Mexico, the Netherlands, the Caribbean, and the United Kingdom.

As a background, about 86% of the total MLP securities market, a $490 billion sector, can be attributed to energy and natural resource companies. In the past year, investors have lost $20 billion in publicly traded in master limited partnerships, publicly traded oil funds. This amounts to an astonishing $8 of every $10 they had invested, according to a report prepared for The Associated Press article. The research does not include losses from $37 billion of bonds sold by the partnerships in the five years since 2010 or losses from private placement partnerships. However, banks like Citigroup, Barclays, and Wells Fargo made an estimated $1.1 billion in fees for selling these products to investors.