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Articles Posted in Alternative Investments

Financial Advisor in Ludlow, Massachusetts is Named in Two Pending Customer Disputes

Joseph Anthony Leonczyk, a Commonwealth Financial Network registered representative, is currently named in two pending customer disputes in which the claimants allege that he unsuitably recommended that they invest in FS Energy and Power Fund (FSEP),  FS KKR Capital Corp. (FSK), and other alternative investments. The claimants are seeking $65K and $100K, respectively, for their losses.

FS Energy and Power and FS KKR Capital investors have both suffered significant losses. FS KKR Capital underwent a reverse split last year that caused its value to drop. FS Energy and Power stopping distributions while possibly heading for bankruptcy. Its latest share price on the secondary market is $1/share.

Ex-LPL Broker Marketed Non-Traded Investments To Mississippi Retiree 

A retired investor has filed a Financial Industry Regulatory Authority (FINRA) arbitration claim against LPL Financial and its former broker, Tamber King Proctor, seeking up to $100K in damages. 

The claimant contends that LPL Financial and Proctor should have never recommended that he invest in the business development company (BDC), FS Energy & Power Fund (FSEP), and the Northstar Healthcare Real Estate Investment Trust (REIT). 

Proprietary, Non-Traded Oil, Gas and Energy Investments Plunged  In Value

If your David Lerner Associates broker recommended and sold you any of the firm’s proprietary non-traded oil and gas investments and you sustained significant losses, you may have grounds for an investor fraud claim for damages. 

The privately-held broker-dealer exclusively sold investments and mutual funds to customers in its Spirit of America Energy Fund (NASDAQ: SOAEX), as well as its Energy 11 LP and Energy Resources 12 LP. 

Risky, Illiquid Business Development Company Was Not Suitable for Many Investors

If you are someone who invested in the Sierra Income Corporation, you may have lost money. This business development company (BDC) is a non-traded investment. 

Earlier this year, Sierra Income suffered losses after its announced merger with Medley Capital Corp. and Medley Management Inc. was terminated because of the economic uncertainty caused by COVID-19. Not long after that, the company announced that it was suspending monthly redistributions.

Investor Contends Insigneo Securities Broker Unsuitably Handled Account

A former customer of Felipe Henao Vargas, an Insigneo Securities stockbroker, is pursuing a Financial Industry Regulatory Authority (FINRA) arbitration claim against the brokerage firm for $1.3M in damages related to the iPath Series B S & P 500 Short Term Futures ETN (VXX). Henao is also a registered investment advisor with Global Investor Advisory Services, LLC in Miami, Florida. 

The investor said that Henao had placed a short-term trade for 20,000 of the Barclays exchange-traded note (ETN) in late February 2020 in the investor’s account and then made another trade a few weeks later to cover the short. The claimant reportedly wrote an email expressing concerns over the brokerage account’s performance, which had depreciated in value, and Henao’s lack of communication.

Former Canonsburg, Pennsylvania Stockbroker Faces Selling Away Allegations

Three years after the Financial Industry Regulatory Authority (FINRA) barred him, Jonathan Douglas Freeze remains the subject of eight pending customer disputes. Most of these investor claims accuse him of selling away and investing customers’ funds in Alternative Investment Holdings, a North Carolina real estate and investment holdings company, without Fortune Financial Services’ authorization.  

Freeze worked 21 years in the industry. He also previously was a broker for Summit Brokerage Services, LPL Financial (LPLA), Lincoln Financial Advisors, and The Lincoln National Life Insurance Company.

Three Pending FINRA Arbitration Claims Accuse Triad Advisors Broker of Unsuitability

Lee Duckworth, the CEO of investment advisory firm Capital Wealth Management and a Triad Advisors stockbroker, was recently named in three Financial Industry Regulatory Authority (FINRA) arbitration claims accusing him of making unsuitable investment recommendations to customers. 

At least one of the disputes involves private placements from GPB Capital Holdings, an alternative asset firm accused of running a more than $1.5B Ponzi scam. Duckworth is a West Warwick, Rhode Island broker and investment advisor.

Investor’s FINRA Arbitration Claim Seeks Damages of Up to $100K

A Florida retiree has filed a Financial Industry Regulatory Authority (FINRA) arbitration claim against the brokerage firm, National Securities Corp. 

The claimant contends that agents of National Securities Corp overconcentrated his account in real estate investment trusts (REITs), privately traded securities, and private placements. This included a large position in GPB Capital Holdings, which is accused of operating an over $1.5B Ponzi scam.

Pending Allegations Likely Involve UBS YES Strategy 

Frederick Maximillian Kort, a former UBS Financial (UBS) broker, is facing allegations that he made misrepresentations when making unsuitable investment recommendations to customers. 

According to his BrokerCheck record, there are two pending customer disputes against him,  both involving an options overlay strategy. While the disclosure does not specifically state so, this is likely UBS’s Yield Enhancement Strategy, in which many of the firm’s registered representatives have come under fire for selling to investors. 

Franklin Square Energy and Power Fund’s Board Suspends Repurchase Program

If you are someone who invested in Franklin Square Energy and Power Fund (FSEP), you have likely experienced losses. The non-traded business development company’s (BDC) board recently announced that it was suspending its repurchase program and its share price has once again plunged. 

While FSEP has pointed to COVID-19, the resulting turbulence, and oil prices sinking as reasons for its current woes, investors may have reason to pursue broker fraud and negligence claims if their broker-dealer unsuitably recommended this investment or failed to apprise them of the risks involved.

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