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Can I Recover Losses from Former David Lerner Associates, Inc. Broker Rafael Klein?

Posted on Tuesday, January 12th, 2021 at 9:16 pm    

David Lerner Associates

There are options for customers of former David Lerner Associates, Inc. broker Rafael Klein (CRD# 2865823) who suffered investment losses due to Energy 11. Klein has been registered with David Lerner Associates, Inc. in Westport, Connecticut since 2005 and with Spirit of America Management Corp. in Westport, Connecticut since 2018.

As of May 2020, the energy sector has become the second-largest group in the S&P Index, representing just 3% of the index, compared to 15% 10 years ago and 30% back in 1980. It is alleged that David Lerner Associates, Inc. brokers recommended their clients invest in non-public limited partnerships, including Energy Eleven (Energy 11), which may not have been suitable for many investors. 

Energy 11, LP is a public non-traded limited partnership that was formed to acquire and develop oil and natural gas properties throughout the United States. Energy 11, LP has raised more than $350 million and has invested the proceeds in non-operated working interests in approximately 221 existing producing wells and approximately 247 future development locations in the Sanish field located in Mountrail County, North Dakota, according to its website. Energy 11, LP is not publicly traded and has limited liquidity. 

Klein has been the subject of four customer complaints between 2011 and 2020, one of which was closed without action, according to his CRD report. Recent complaints are regarding: 

November 2020. “Unsuitability, misrepresentation/omission, breach of fiduciary duty, failure to supervise.” The customer is seeking $300,000 in damages and the case is currently pending. The complaint was regarding mutual funds and private placements including Energy 11 and the complaint took place while Klein was registered with David Lerner Associates, Inc. 

August 2020. “Misrepresentation and omission, breach of fiduciary duty, failure to supervise, fraud, unauthorized trading.” The customer is seeking $300,000 in damages and the case is currently pending. The complaint was regarding mutual funds, real estate securities, and private placements including Energy 11 and the complaint took place while Klein was registered with David Lerner Associates, Inc. 

December 2016. “Client alleged unsuitability. Dates: 11/24/14 through 2/9/16.” The customer sought $96,000 in damages and the case was settled for $20,250.

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, David Lerner Associates, Inc. may be liable for investment or other losses suffered by Klein’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.