Erez Law is currently investigating former RBC Capital Markets, LLC financial advisor John S. Simpson (CRD# 719367) regarding concentrated investment portfolios in the high risk energy sector.
Many oil and gas companies have experienced price fluctuations over the past few years, which has put financial stress on the oil and gas industry. A supply glut in 2014 and 2015 led to some of the lowest prices the market has seen in recent years. In turn, securities values also dropped. While financial advisers can effectively coax clients into lucrative high risk, high yield investments in the oil and gas industry, some fail to fully inform their clients of the inherent risks.
Simpson was registered with RBC Capital Markets, LLC in Hunt Valley, Maryland from 2009 to 2016. Simpson was terminated from RBC Capital Markets regarding, “Violation of firm policy regarding use of discretion in client accounts.” In 2003, Simpson was also terminated from UBS Painewebber regarding, “UBS painewebber alleged unauthorized trading, violation of the firm’s solicitation policy, and management’s loss of confidence in me.”
In December 2016, FINRA barred Simpson after he refused to appear for on-the-record testimony in connection with FINRA’s investigation of the conduct that gave rise to Simpson’s termination from RBC Capital Markets for violation of firm policy regarding use of discretion in client accounts.
Simpson has been the subject of six customer complaints between 2008 and 2016, one of which was denied, according to his CRD report:
- August 2016. “Clients allege dating back to 2014, the customers portfolio was concentrated in the energy and metals sectors and was unsuitable for people of their age and risk tolerance.”
The customer is seeking $11,000,000 in damages and the case is currently pending.
- April 2016. “Customers allege they have a low risk profile and were over concentrated in the oil sector, and that their portfolio was not adequately monitored since January 2015, resulting in investment losses. They also state they have found no signed document giving the representative permission to trade without consulting them first.” The customer sought $448,000 in damages and the case was settled for $10,360.90.
- March 2016. “Customer alleges representative ignored her requests to reduce the exposure to the oil and gas sector in her portfolio. Time frame is May 2015 – January 2016.” The client sought $366,387 in damages and the case was settled for $7,700.80.
- March 2016. “Customers contend their portfolio was concentrated and not suitable for their investment objectives, and believe that the firm did not have written authorization on file for the representative to exercise discretionary trading authority. Time frame identified is last several years.” The case was settled for $11,042.25.
- February 2016. “Customers seek reimbursement of past 24 months in commissions paid after learning that their financial advisor was expected to obtain their authorization prior to placing trades in their accounts.” The case was settled for $20,285.78.
Pursuant to FINRA Rules, member firms are responsible for supervising a broker’s activities during the time the broker is registered with the firm. Therefore, RBC Capital Markets may be liable for investment or other losses suffered by Simpson’s customers.
Erez Law represents investors in the United States for claims against former RBC Capital Markets financial advisor John S. Simpson, who is alleged to concentrate client investment portfolios in the high risk energy sector. If you were a client of former RBC Capital Markets financial advisor John S. Simpson or another firm, and have experienced investment losses, please call us at 888-840-1571 or complete our contact form for a free consultation. Erez Law is a nationally recognized law firm representing individuals, trusts, corporations and institutions in claims against brokerage firms, banks and insurance companies on a contingency fee basis.