Damage Claims Exceed $24 Million for Stifel Advisor's Note Strategy

Posted on August 23rd, 2023 at 1:15 PM
Damage Claims Exceed $24 Million for Stifel Advisor's Note Strategy

From the desk of Jim Eccleston at Eccleston Law 

Complaints against an advisor from Miami-based Stifel Nicolaus & Co. are increasing due to a structured note strategy, and additional million-dollar claims have been added to the ongoing concerns.

Chuck A. Roberts' BrokerCheck record shows a recent arbitration dispute filed on July 21. These claims, with damages ranging from $500,000 to $5 million across nine arbitration filings, have resulted in a cumulative total of $24.5 million in sought-after damages.

According to AdvisorHub, Stifel is named as the respondent in all the complaints, not Roberts. The claims alleging negligence, breach of fiduciary duty, and unauthorized trading are detailed by Jeff Erez, a plaintiff's attorney from a Miami-based law firm representing eight of the claimants. A person familiar with the matter said that the company intends to defend against the claims by arguing that the customers were all savvy investors aware of the risks associated with their portfolio.

Erez revealed that Roberts had, in certain instances, concentrated the structured notes heavily in stocks like Dynatrace, Pinterest, and Snapchat or in indexes that were potentially volatile, including the SPDR S&P Biotech ETF (NYSE: XBI). According to Erez, during the latter part of 2021 and extending into 2022, both the mentioned stocks and the biotech index experienced steep declines in value, resulting in significant financial losses for Roberts' clients. Erez indicated that Roberts imposed commissions of approximately 1.5 percent to 2 percent on clients. While this commission rate was not exceptionally high for structured products, it became significant due to the combination of frequent trading, according to Erez.

 

Eccleston Law LLC represents investors and financial advisors nationwide in securities, employment, transition, regulatory, and disciplinary matters.

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