Articles Tagged with Linn Energy

AdobeStock_33766885-1-300x200Are you concerned about losses you may have sustained because of George Merhoff, and Cetera Financial Group? If so, the securities attorneys at Stoltmann Law Offices may be able to help you recover those investment losses by bringing legal action against Cetera. We sue brokerage firms like Cetera in the Financial Industry Regulatory Authority (FINRA) arbitration forum on a contingency fee basis. The firm may be responsible for losses because it has a duty to supervise its representatives, such as Merhoff, and, if it does not, can be held liable for money losses. The call to us is free with no obligation, so please call 312-332-4200 for a consultation with an attorney.

George Merhoff allegedly over-concentrated client portfolios in unsuitable, high-risk, alternative energy investments, such as Linn Energy. Investments like Linn Energy in the oil and gas and energy sector tend to be extremely illiquid investments. Merhoff also was alleged to have recommended unsuitable investments, been negligent, breached fiduciary duty and breached contract since December 2015. All of these are against industry rules.

Merhoff was registered with AAG Securities in Cincinnati, Ohio from September 1997 until March 1998 and Pacific West Securities in Klamath Falls, Oregon from June 1998 until February 2012. He is currently registered with Cetera Advisors in Klamath Falls and has been since February 2012. He has 10 customer disputes against him, all of them pending and two criminal final dispositions.

The Financial Industry Regulatory Authority (FINRA) is expecting a massive wave of arbitration claims against brokers and their brokerage firms in the coming months, thanks to bad energy investments. Because of the huge drop in oil prices, many of the cases being discovered are ones in which an adviser put too much of a client’s money into energy investments that turned out to be basically worthless as U.S. oil prices collapsed. Many of the customers are elderly and too much of their portfolios were put into risky oil and gas investments. And adviser must take into account if the investment is suitable for the client or not, and age, net worth, investment objectives and risk tolerance play large factors in determining this. Many advisers put much of their client’s money into oil and gas and energy investments, because the commissions were high. Now, with oil prices tumbling, it is a very bad situation for those whose portfolio was concentrated in the resources. High-yield default rates in the energy sector are expected to spike to 20% this year from about 7% at the end of 2015, and less than 1% in December 2014, according to Fitch ratings. The trailing 12 month default rate among exploration and production companies will jump even higher by the end of 2016, to between 30% and 35%, also Fitch estimates.

Another issue investors could see is that many do not become aware of the extent of their losses until they receive their year-end statements from their broker, or around the month of April. This could very well solidify the fact that analysts are predicting many more arbitration claims in the coming month and months ahead. Some client’s money was concentrated almost exclusively in oil and gas investments and these individuals are expecting to be hit especially hard. Some of the investments include: Linn Energy, AmeriGas Partners and British Petroleum, among others. Linn Energy, in a filing with the Securities and Exchange Commission (SEC) on Tuesday stated that a Chapter 11 bankruptcy filing may be “unavoidable.” This means serious trouble for investors. Call us today if you have experienced losses with Linn Energy or other oil and gas or energy investments. We may be able to help you bring a claim against your brokerage firm to recover your money.

Stoltmann Law Offices continues to investigate master limited partnerships (MLPs) which are a type of publicly traded limited partnership that qualify for certain tax benefits. MLPs do not pay corporate income taxes on profits. Taxes are paid when the MLP distributes the money to the partners who report that income on their tax returns. This could create a problem for investors, when negotiations with creditors include debt forgiveness. Partners then are expected to pay income taxes on the forgiven debt. If you were sold an MLP investment, you may have a case against the brokerage firm from which you purchased it, because it has a duty to reasonably supervise its employees to make sure they only recommend and sell suitable investments based on their client’s net worth, age and investment objectives. Some of the MLPs include Linn Energy, Atlas America and Cushing Royalty.

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