Recovery of Investment Losses in Bakken Income Fund
Have you suffered losses investing in Bakken Income Fund? If so, The White Law Group may be able to help you by filing a FINRA Arbitration claim against the brokerage firm that sold you the investment.
Bakken Income Fund, which raised $20.6 million from 309 investors as of a filing with the SEC in Feb. 2015, filed for bankruptcy in Denver Oct. 17, 2016. The shale oil investment fund has filed for Chapter 11 bankruptcy, owing creditors between $1 million and $10 million.
Many oil and gas LPs have high expense ratios, and due to the decline in the overall health of the oil and gas market, are suffering. Some are on the brink of default, or worse yet, bankruptcy. Such an outcome is extreme, but not unforeseen. It only highlights the unsuitability of these investments for most retail investors – particularly in large concentrations.
The fund is managed by Coachman Energy Partners, a wholly-owned business of Coachman Energy.
Coachman Energy Partners LLC operates as an energy company that focuses on pursuing opportunities in the Bakken Shale and other unconventional shale oil plays in North America, according to Bloomberg. The company’s asset portfolio includes working interest positions in mineral acreage, proved undeveloped drilling prospects, and producing assets in North Dakota, Montana, and Colorado. It also focuses on acquiring oil and gas assets in Kansas, Oklahoma, Wyoming, and Texas. The company was founded in 2006 and is based in Greenwood Village, Colorado.
The company often raises money through Reg D private placements such as the Bakken Income Fund as well as the following:
Bakken Drilling Fund III LP
Bakken Drilling Fund IV LP
Bakken Drilling Fund IVB LLC
Coachman Energy Land II LLC
Coachman Energy VI LP
Coachman Energy VIB LLC
Coachman Energy VII Offshore Feeder Fund LTD
Coachman Energy VII Onshore Feeder Fund LP
The Trouble with Reg D Private Placements
Reg D private placements, like Bakken Income Fund and other Coachman Energy Partners offerings, is they generally involve a much greater degree of risk compared to traditional investments, such as stocks, bonds or mutual funds. Interests in private placements are often sold as unregistered securities and lack the same regulatory oversight as more traditional investment products.
Another problem with Coachmen Energy Partners offering is the high degree of risk that comes with the volatile oil and gas industry.
Unfortunately, some brokers may have downplayed the risks associated with alternative investments and misled investors into thinking that they are “safe” investment products. The high sales commission brokers earn for selling interests in private placements may have provided some brokers with enough incentive to push the product to unsuspecting investors.
Broker dealers that sell alternative investments are required to perform adequate due diligence on all investment recommendations to ensure that each investment is suitable for the investor in light of the investor’s age, risk tolerance, net worth, financial needs, and investment experience.
If a broker makes an unsuitable investment recommendations or fails to adequately disclose the risks associated with an investment they may be liable for investment losses.
The White Law Group is investigating the liability that brokerage firms may have for recommending Bakken Income Fund for other Coachman Energy Partners offerings.
To determine whether you may be able to recover investment losses incurred as a result of your purchase of Coachman Energy Partners LLC or another private placement, please contact The White Law Group at 1-888-637-5510 for a free consultation.
The White Law Group, LLC is a national securities fraud, securities arbitration, investor protection, and securities regulation/compliance law firm with offices in Chicago, Illinois and Franklin, Tennessee. For more information on the firm, visit www.WhiteSecuritiesLaw.com.