Former Wells Fargo Client Settles FINRA Arbitration for $40,000 for Energy Sector Losses

Posted on Monday, November 19th, 2018 at 11:57 am    

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In October 2018, a former client of Wells Fargo Advisors Financial Network, LLC settled a FINRA arbitration for compensatory damages for $40,000 for losses sustained from investments in the high risk energy sector. The investors were clients of financial advisor Jerry Holdsworth (CRD# 3241043).

The causes of action included negligence, breach of fiduciary duty, negligent supervision, and breach of contract. The causes of action related to the claimants’ allegations that Holdsworth, an unnamed party employed by Respondent, invested Claimants’ retirement savings in an unsuitable overconcentration of energy investments. These investments included the United States Natural Gas Fund (“UNG”), the United States Oil Fund (“USO”), and Cheesapeake Energy, Ensco PLC, and Marathon Oil. The FINRA arbitration hearing was conducted in Omaha, Nebraska.

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. 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.

Holdsworth has been registered with Wells Fargo Advisors Financial Network, LLC in Lincoln, Nebraska since 2009. Holdsworth has also been the subject of one additional customer complaint from 2008 that was denied, according to his CRD report.

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, Wells Fargo may be liable for investment or other losses suffered by Holdsworth’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.