WHEELING – A Wheeling lawyer and his wife say they lost substantial amounts of money after their broker placed their investments into risky accounts.
James G. Bordas Jr. and Linda M. Bordas filed a lawsuit in Ohio Circuit Court against Ernest L. Coffindaffer, Wachovia Securities and Wells Fargo Advisors.
The Bordas claim they placed assets with Coffindaffer and Wachovia beginning in late December 2002.
During meetings between Coffindaffer and the Bordas, the couple informed Coffindaffer they wished to invest their money so that as much principal as possible could be protected, according to the complaint.
"As early as December 27, 2002, the defendants knew and were specifically advised by plaintiffs that plaintiffs would rather get only 1% point on their investment than invest in risky securities hoping to obtain large gains and then losing up to 8-12 percent of their capital," the suit states.
Assuring the Bordas he understood their desires, Coffindaffer promised to abide by their wishes, the complaint says.
The Bordas also told Coffindaffer that they knew little about properly investing their money and did not have the time to follow the markets, so they depended on him to manage their funds properly.
"The defendant Coffindaffer told plaintiffs they could rely upon his expertise and he would devote considerable time and attention to the plaintiffs' account so as to protect plaintiffs' capital and preserve the same," the suit states. "Instead, the defendant Coffindaffer paid little attention to plaintiffs' accounts and caused the plaintiffs, though his investment strategies of placing plaintiffs' money in risky stocks and poorly performing municipal bond funds, to be invested in an unbalanced portfolio so as to suffer substantial losses to their portfolio managed by defendants."
Up until 2005, Wachovia and Coffindaffer were using outside professional managers to handle the Bordas' account, but discontinued their use in 2005, according to the complaint. As a result, the Bordas' portfolio value suffered a substantial decline, the complaint says.
"Plaintiffs recently learned and verily believe that defendants Coffindaffer and Wachovia's motive in removing the above-mentioned 'outside professional managers' was based on Coffindaffer and Wachovia's scheme to increase their income and profits to the detriment of plaintiffs thereby breaching their fiduciary duty to the plaintiffs," the suit states.
Once in control of the Bordas' money, Wachovia and Coffindaffer promised to place it in individual bonds, but instead placed the funds in risky municipal bond funds, causing the Bordas to lose substantial amounts of money, they claim.
Throughout the Bordas' time with Wachovia and Coffindaffer, which lasted until September, the defendants repeatedly assured the Bordas that their money was secure and that their funds were being invested in a balanced and conservative portfolio, according to the complaint.
Later, the Bordas discovered their financial portfolio had drastically deteriorated "by defendants' risky, ill-thought-out, and contrary investments made on behalf of plaintiffs through the managed account as hereinabove and further stated," the suit states.
Because of their financial problems, the Bordas say they have suffered mental and emotional anguish, inconvenience, psychological damages and a diminishment in their ability to enjoy life.
Allegations in the Bordas' five-count complaint include breach of contract, breach of duty to provide competent financial advisors, breach of fiduciary duty, professional negligence and common law fraud.
The Bordas are seeking an unspecified judgment, plus pre- and post-judgment interest, attorneys' fees and other relief the court deems just.
James G. Bordas will be representing himself, along with Geoffrey C. Brown and James B. Stoneking of Bordas and Bordas in Wheeling.
Ohio Circuit Court case number: 09-CV-229