Hilliard Lyons Ordered to Pay $569K For Allegedly Overconcentrating Accounts in Breitburn Energy Partners

A Financial Industry Regulatory Authority arbitration panel has ruled that J.J.B. Hilliard, W.L. Lyons LLC must pay claimants Troy and Elizabeth Benitone $569K. Also known as Hilliard Lyons, the wealth investment firm is accused of overconcentrating the Benitones’ accounts in Breitburn Energy Partners stock.

The claimants, in their oil and gas fraud case, alleged breach of fiduciary duty, negligent misrepresentation and omission, common law fraud, breach of contract, and negligence supervision. The Benitones contend that Hilliard Lyons and its registered representative sold all of the claimants’ blue chip stocks, investing the money that was in their joint account and in Troy’s IRA in Breitburn. They lost $350K, with statutory damages at 10% on the purchase cost at $441K, from being overconcentrated in Breitburn.

The Benitones believe that it was the lack of diversification in their investments that put them at high risk of loss, especially as they had conservative investment goals and could not handle much risk at all. Also, Hilliard Lyons was the underwriter for the Breitburn Energy Partners stock.

The FINRA arbitration panel awarded the Benitones $450K in compensatory damages, $100K in punitive damages, and $19K in costs.

It was in May 2016 that Breitburn Energy Partners’ stock price plunged to .31 cents and the company soon filed for Chapter 11 bankruptcy protection. The oil and gas master limited partnership had borrowed millions of dollars. When oil and gas prices dropped, Breitburn found it extremely challenging to not just pay back loans but also to issue distributions to investors.

Breitburn Oil and Gas Investment Fraud Lawyers
At Shepherd Smith Edwards and Kantas, LTD LLP, our oil and gas fraud attorneys represent investors who backed Breitburn and sustained oil and gas investment losses as a result. Many investors were told that by investing in Breitburn they were backing a safe proposition that would make them money. For investors whose accounts became overconcentrated in Breitburn, their losses were significant.

If you sustained oil and gas investment losses from investing in Breitburn stock that you purchased from Hillard Lyons, UBS (UBS), Morgan Stanley (MS), Merrill Lynch (BAC), JPMorgan (JPM), Oppenheiemer (OPY), Wells Fargo (WFC), or another broker-dealer, contact Shepherd Smith Edwards and Kantas LTD LLP so that we can help you explore your legal options. Our Breitburn investment fraud lawyers represent investors throughout the US.

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