According to FINRA’s “Brokercheck”, Robert J. Donavan (from the Boston and Florida areas) had five customer complaints against him, which include allegations of unsuitable investments and breach of fiduciary duty where one investor said she was induced to “make unsound purchases and disproportionate allocations”.
Even though he denied the allegations, financial advisors like Robert J. Donavan may only recommend investments that are “suitable” for the customer, based on their age, investment objectives (like income or growth), risk tolerance (like conservative or moderate), net worth, income from other sources, time to retirement, and any other factors that are material to the customer’s financial circumstances and needs.
Some advisors recommended high concentrations of Energy Master Limited Partnerships that throw off an income, but are unsuitable due to the concentration in one sector (oil or energy), the use of the return of the investors’ own principal to meet distributions promised to investors, the hidden nature of a potential large tax bill upon sale of the investment, and the complicated, hard to understand nature of the accounting involved in a partnership, among other factors.
Many investors have lost hundreds of thousands and even millions of dollars investing in MLPs. If you or a loved one held large positions in MLPs, we would like to hear from you. Contact Sonn Law at 833-StockLaw for a free free review.