Syosset, NY Financial Advisor is Named in $920K of Pending Customer Disputes Alleging Unsuitability
Our energy, oil and gas investment fraud attorneys at Shepherd Smith Edwards and Kantas (SSEK Law Firm at investorlawyers.com) are looking into allegations that David Lerner Associates broker, Martin Kevin Walcoe, may have unsuitably sold Energy 11 LP, Energy Resources 12, and Spirit of America Energy (SOAEX) investments to customers. All three investments have been sold exclusively by David Lerner Associates’ registered representatives to its customers.
Walcoe has spent his entire 34 years in the industry as a David Lerner Associates broker. He has five disclosures on his BrokerCheck record. Two of them are still pending, with customers seeking $920K in damages:
- 3/2021: This claimant is alleging unsuitability, breach of fiduciary duty, and misrepresentations and omissions. They are requesting $820K in damages.
- 1/2021: Making similar allegations, this investor is seeking $100K in damages.
- 8/2016: This unauthorized trading case was denied.
- 7/2014: This unsuitability case seeking over $90K was closed due to lack of action.
- 5/2012: This unsuitability case involving another proprietary David Lerner Associates product, the Apple REIT, resulted in the broker-dealer being ordered by a FINRA arbitration panel to pay the investor a $260K award.
Oil, Gas, and Energy Investments Are Not For Inexperienced Investors
These exclusively sold David Lerner oil and energy investments were already undergoing a lot of volatility before COVID-19. The pandemic only further caused the demand for oil to plunge even further.
Energy 11 and Energy Resources 12 are non-public limited partnerships established to acquire and develop properties involving oil and natural gas. SOAEX’s stated aim is to invest at least 80% of its funds in energy companies and entities related to energy.
Oil, gas, and energy investments tend to have limited liquidity and can be highly impacted by market activity. This can place investors at risk of expose to a lot of volatility. While David Lerner Associates and its brokers earned high commissions from touting these investments—6% in sales commissions, incentive pay, and “4% of the gross proceeds of the common units sold” for Energy 11 and Energy Resources 12—investors have reported losses.
A number of investors have come to realize that not only were they unsuitably invested in these proprietary David Lerner Associates products, but also, with these investments their portfolios were overconcentrated in the energy sector. This only increased their losses. It didn’t help that Energy 11 suspended distributions last year.
Seasoned Energy 11, Energy Resources 12, and SOAEX Investment Fraud Law Firm
It was just recently that SSEK Law Firm filed a FINRA arbitration claim against David Lerner Associates on behalf of a Florida retiree who suffered Energy 11-related losses. The claimant, who is requesting six figures in damages, is an inexperienced investor who should never have gotten involved with this type of product, to begin with.
If you suffered significant investment losses while working with David Lerner Associates broker Martin Walcoe, whether over Energy 11, Energy Resources 12, SOAEX or another investment, call our securities law firm at (800) 259-9010 today so that we can help you explore your legal options.