The Colorado Division of Securities barred financial advisor James McGehee and revoked McGehee Wealth Management's investment adviser license for recommending high-risk options trading strategies to more than half of the firm's clients.
The report indicates that James Walton McGehee (CRD #5562429) failed to adequately disclose this trading strategy and the risks associated with it to his clients.
Regulators found that the size of the options trades and amount of client funds in those strategies made the already-risky recommendations extremely high risk and potentially unsuitable for unsophisticated investors or any investor with low-to-moderate risk tolerance preferences.
For instance, a 76-year-old retired customer living primarily on social security lost "substantially all of his retirement savings," or $160,000, as his account fell to $18,293.70.
Additionally, investigators found that McGehee attempted to borrow money from clients several times in violation of ethics rules.
If you invested with James McGehee or any broker or investment adviser who unsuitably recommended an excessively-risky options trade strategy that resulted in losses or other financial damages, please call an experienced FINRA arbitration attorney at The Law Offices of Jonathan W. Evans & Associates at (800) 699-1881 for an investigation and consultation.