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Rick Konecny Investigated for Unsuitable Investments, Unauthorized Trading & Overconcentration

A former JP Morgan financial advisor, Rick Konecny, has been accused by former clients of recommending unsuitable investments, unauthorized trading and overconcentration. Rick Konecny was discharged from JP Morgan in 2016 for failing to escalate client matters and follow requirements with respect to execution of trades on a discretionary basis.

Former clients of Konecny claim that while at JP Morgan, he neglected his duty to recommend suitable and appropriate investments for his clients. Some of Rick Konecny’s former clients claim that he and his former employers, JP Morgan and UBS financial, are liable for their investment losses. Rick Konecny has also worked for National Securities Corporation and Morgan Stanley & Co. He has always worked in Chicago.

One dispute totaling $470,000 from April of this year is still pending against Rick Konecny. Rick Konecny has two settled disputes. One settled for $180,000 and the other settled for $375,000. Both settled disputes are from March of 2016. They both are for allegations of unsuitable and unauthorized trading and overconcentration. Konecny was also accused of overconcentration in 2004 in a dispute that was closed.

Victims of Rick Konecny claim that he recommended the following investments;

  • Sandridge Energy Inc. (SD)
  • Yamana Gold Inc. (AUY)
  • Cliffs Natural Resources Inc (CLV)
  • Arch Coal Inc. (ACI)
  • Exco Resources (XCO)
  • Imagold Corp (IAG)
  • Moly Corp (MCPIQ)

Unsuitability

Brokers and financial advisors are obligated to recommend suitable investments to their clients. An investment is unsuitable if the client cannot afford the potential losses or does not understand the risks associated with the investment. Unsuitability also occurs when the investment does not match the client’s goals.

Unauthorized Trading

With few exceptions, investment brokers must obtain client authorization before buying or selling stocks. To do otherwise is “unauthorized trading” and violates financial laws and ethical obligations.

Unauthorized trading can be conducted by individual brokers, but can also be firm-wide. In either scenario, the investor suffers a loss. Unauthorized trading is sometimes covered up by fabricated records, but if the client has enough evidence that the trading was unauthorized, they can recover monetary damages for investment losses due to the trade.

Overconcentration

Overconcentration occurs when an investment portfolio is narrowly focused in one asset type, class, or sector and subject to increased risk and potential catastrophic loss. Investments in only one or very few stocks, asset class, or single sector of the economy all face increased risk of overconcentration and heavy losses.

If you are an investor who has lost money from investments that may have been improper, the attorneys at Meyer Wilson are interested in helping you determine if you have been a victim of potential unsuitable investments, unauthorized trading or overconcentration. The attorneys at Meyer Wilson can answer any questions you may have during a no-cost, no-obligation consultation to discuss your case.

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The information contained in The Firm’s posts on its blog, fraud alerts, investigations or elsewhere on the site is based upon information obtained from other sources including, but not limited to, news outlets and federal, state, and regulatory agency filings. All suspects and subjects of postings herein are presumed innocent until proven guilty in a court of law or administrative action and any and all crimes are alleged until a court or regulatory agency finds otherwise .

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