The law firm of Oakes & Fosher is presently investigating the alleged misconduct of securities broker Rodney Potratz. According to his publicly available FINRA BrokerCheck report, Rodney Potratz has been the subject of multiple customer disputes over the course of his career.

Rodney Potratz is an Iowa based securities broker. He has worked in the securities industry for twenty-six years. During his career, he has been registered with three different securities firms.

His Registrations

  • The Equitable Life Assurance Society of the United States (1993-2000)
  • AXA Advisors (1993-2003)
  • FSC Securities (2003-Present)

The Allegations 

  • In December 2011, an attorney, on behalf of a customer alleged that Rodney Potratz spent years recommending unsuitable investments. The attorney also alleged that Potratz had executed multiple trades without authorization from the customer.
  • In November 2019, customers alleged that Rodney Potratz recommended highly inappropriate alternative investments. This case is presently pending. The customers are seeking $6 million in damages.

What Does This Mean?

The term alternative investments is a term used to describe privately traded securities known as private placements. These investments are not traded on public securities exchanges. This means they are very poorly regulated and should not be recommended to most investor types. Private placements are investment pools designed to do things like funding real estate projects or providing private mortgages. The nature of the businesses they take on make these investments incredibly risky.

Managers of private placements also need to maintain capital until such time that their project is completed and the company is officially liquidated–which can take years. Some private placements offer scheduled buy outs to investors; however, only a finite amount are offered, and the buy out price is almost always significantly less than what investors are told the shares are actually worth. Investors most often have to wait until such time that the fund is officially liquidated to get the full amount of their shares value; however, at that time, depending on the company’s success, the shares may be completely worthless at that point.

Despite how unsuitable private placements can be, many securities brokers continue to push them onto unsuspecting investors because of the excessively high commissions they receive when transactions are executed. Broker commissions for these products can be as high as 15 percent of an investor’s principal investment. When an investor’s principal is drained that substantially, it makes it almost impossible for them to see a profit under anything besides booming market conditions.

Oakes & Fosher Can Help

Many investors are unaware of the legal recourse available to them after losing money due to securities broker fraud and/or negligence. The truth is that investors who have lost money in this fashion may actually be entitled to damages.

Oakes & Fosher dedicates its entire legal practice to helping investors across the nation. If you, or someone you know, have lost money investing with Rodney Potratz, please contact Oakes & Fosher for a free and private consultation. We work on a contingency basis, which means there are no fees charged unless we collect for you.