Erez Law is currently investigating former UBS Financial Services, Inc. financial advisor Erik Littlejohn (CRD# 1910841) regarding energy sector losses. Littlejohn has been registered with Merrill Lynch, Pierce, Fenner & Smith Incorporated in Houston, Texas since 2015. Previously, he was registered with UBS Financial Services Inc. in Houston, Texas from 2009 to 2015.
It is reported that a former customer of Littlejohn recently filed a FINRA arbitration alleging $499,999 in losses sustained from investments in the high risk energy sector and Master Limited Partnerships (MLPs). The customers were looking for income-producing yet safe investments, and it is alleged that Littlejohn concentrated their portfolio in energy investments and MLPs from companies such as Linn Energy, Western Gas Partners, Nustar, Plains All American, Targa Resources and Kinder Morgan. It is alleged that Littlejohn did not warn his clients as to inherent risks in the volatile energy market. Additionally, it is alleged that after the customers expressed concerns in the decline of their portfolio, Littlejohn advised them that the losses were temporary and even encouraged them to investment additional money in MLPs.
Over the past few years, oil prices have significantly declined. 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, including the values of Linn Energy and many others. The volatile energy sector experienced significant turmoil, and many energy companies were negatively impacted when global crude oil prices fell below $40 per barrel at the end of 2015. This was the lowest level since early 2009, as supply was in excess of global demand. Oil and gas companies experienced a spike in bankruptcies, which have left many investors reeling.
Linn Energy was an oil and natural gas company headquartered in Houston, Texas. When global crude oil prices dropped, Linn Energy accrued significant debt. According to the company, Linn Energy, LLC filed a voluntary petition for restructuring under Chapter 11 of the Bankruptcy Code in May 2016 to alleviate itself of $6.06 billion in debt. In February 2017, LINN Energy, Inc. was formed as the reorganized successor to Linn Energy, LLC.
Littlejohn has been the subject of one additional customer complaint, according to his CRD report:
September 1995. “Churning, unauthorized trading and unsuitability. Alleged damages $111,793.” The customer was awarded $128,908 in damages.
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, UBS Financial Services, Inc. may be liable for investment or other losses suffered by Littlejohn’s customers.
Erez Law represents investors in the United States for claims against brokers and brokerage firms for wrongdoing. If 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.