The Kansas-based Tortoise Capital Advisors is a “privately owned investment manager . . . that primarily provides its services to high net worth individuals . . . and caters to corporations, pooled investment vehicles, investment companies, and pension and profit sharing plans . . . typically invest[ing] in [the] energy and infrastructure sector,” per Bloomberg Business.
Among Tortoise’s portfolio of funds, a number of them declined between 17% and 36% in 2015 alone, per Morningstar.
These include Tortoise MLPs – Tortoise MLP & Pipeline C (TORCX), Tortoise MLP & Pipeline Investor (TORTX), Tortoise MLP & Pipeline Instl (TORIX) – and Tortoise Equity Funds – Tortoise North American Energy Indep C (TNPCX), Tortoise North American Energy Indep Inv (TNPTX), Tortoise North American Engy Indep Instl (TNPIX), Tortoise Select Opportunity C (TOPCX), Tortoise Select Opportunity Investor (TOPTX), and Tortoise Select Opportunity Instl (TOPIX). For example, TORCX, a fund that reportedly manages more than $1.23 billion in assets, has declined significantly in share price from its previous high of $19.52 in August 2014 according to recent quotes. The fund reportedly trades at just over $9 per share – a decline of more than 50% in less than 18 months. TORTX and TORIX have also seemingly mirrored this performance.
Tortoise funds were said to have been marketed to investors and sold by financial advisors at brokerages such as Mid Atlantic Capital Corp, Morgan Stanley, Pershing FundCenter, Shareholders Services Group, JPMorgan, Fidelity Institutional, FundsNetwork, MSSB Retail Fund, Raymond James, CommonWealth Universe, RBC Wealth Management, Mid Atlantic Capital Group, MSWM Brokerage, and Securities America Inc.
Investors who bought this fund or other Tortoise funds upon promises of good returns and safety of principal a short time ago find themselves questioning how so much money could have been lost so quickly, contrary to the assurances received from the advisor who sold them the product. However, all may not be lost. Investors who lost money in these investments at the recommendation of their financial advisor may be entitled to recover their losses from the brokerage house who sold it to them.
One of the main issues facing financial advisors who sell funds and master-limited partnerships is suitability. Given that MLPs are non-traditional products and typically focus on one sector and one sector only (often energy in the case of MLPs), great care should be taken by an advisor to be sure that the investment is appropriate for the investor in light of their risk tolerance, investment objectives and other factors. When a product is sold to an investor, despite being unsuitable (or inappropriate) for that investor, the financial advisor’s firm may be liable to the investor for their losses.
If you or a family member invested in Tortoise Funds, you should contact our offices to explore your legal rights and options. You can contact the investment fraud lawyers at Malecki Law for a free consultation and case evaluation at (212) 943-1233.
Malecki Law takes a proactive and informed approach to the financial news of today: actively engaging in fact-finding analysis on prospective cases from around the world. Our thorough knowledge of securities law’s history and fine points makes us ideal consultants for investors who have suffered losses due to misadvice from their broker or other financial counsel.