Two Chevron retirees are suing a brokerage firm after discovering their retirement plans had lost thousands of dollars.
In June, John Cleveland and Thomas C. Goodwyne filed suit against UBS Financial Services, Inc., C. Benny Parent, III, Gregory Golding and Robert Bickham in Orleans Parish District Court.
The financial services company and its representatives are accused of breaching Cleveland and Goodwyne's trust by misrepresenting the risk level of their portfolios, failing to disclose important information about the mutual funds purchased and failing to monitor the retirement plans.
The retirees say they were convinced to open retail brokerage accounts with UBS during "free lunch" seminars and direct solicitation by UBS' Retirement Planning Consulting Group. The pair says they were promised high returns through safe investments and continuous monitoring and were assured protection from adverse market events.
Beginning in 2000, the defendant is accused of deviating from the retirement plans and changing investments without full disclosure of the risks. Safe investments were allegedly sold or exchanged for speculative tech funds and aggressive mutual funds.
Cleveland and Goodwyne say they trusted the brokers' actions because of the performance of the accounts in the early years. But, they say, when the market dropped UBS failed to monitor or rebalance the accounts.
"Defendants failed to take any action to change investment strategy because it would lose sales credits and commissions if the investments were liquated. Defendants acted in their own best interest, instead of in the plaintiffs' best interest," the lawsuit reads.
Cleveland and Goodwyne are seeking compensatory damages, interest, damages according to Louisiana law and attorney's fees.
New Orleans attorney James Willeford, Jessica Vasquez and Reagan Toledano of Willeford Law Firm are representing the petitioners.
Judge Piper D. Griffin is assigned to the case.
Case No. 10-6711