Investors of George Merhoff, a broker and advisor with Cetera Advisors, can call 1-866-817-0201 for a free initial consultation with an attorney concerning loss recovery. All consultations are confidential and representations done on a contingent basis, where attorney fees paid from the ultimate settlement or judgment.
Merhoff, a securities broker located in Oregon, has been the subject of approximately 16 lawsuits in the past two years. These lawsuits concern the recommendation of unsuitable securities. Merhoff sold a significant amount of oil and gas investments to his investors over the last six years. Oil and gas investments are inherently speculative.
The sale of unsuitable securities is not only a negligent action, but also a form of fraud. The payout to the broker/advisor from these investments are generally higher. This gives the broker or advisor an incentive to omit from the investor the high level of risk that these investments pose.
Suitability violations exist anytime a recommended investment is inconsistent with the wants and needs of an investor. FINRA, the regulator overseeing financial advisors and securities brokers, prohibits the recommendation of unsuitable securities. These rules also require that the advisor or broker to “know the customer.” This means that the advisor or broker must know the wants and needs of his investors, along with that investor’s tolerance for risk and objectives for the account.
Since the oil and gas investments are speculative investments that are inherently volatile, they would not be suitable investors indicating that they can afford to take significant risk with the funds. The investments would not be suitable for investors looking to receive regular income from their investments or take only moderate risk.
Oil and gas investments of particular interest include Linn Energy (“LINE” or “LNCO”), PennGrowth and Teekay Partners. Also of interest are investors investing in REITs or utilizing margin loans on the recommendation of Merhoff.