Why the Collapse of Option Sellers is Troubling and Tragic but Unsurprising
The business run by James Cordier and his colleagues (Option Sellers) was full of red flags from our perspective as Investor Rights Attorneys: Investing in energy options within self-directed IRAs; purportedly “conservative” strategies with high returns that involved leveraged energy option investing; a sales pitch that required high minimums to invest, along with a theme that investing with Option Sellers would make you “one of the elite”; and accounts apparently opened behind the scenes with less funds than the minimums set forth in Option Sellers’ marketing materials.
The examples above are just a few of the many red flags that we have discovered thus far and believe professional gatekeepers such as FC Stone and Midland should have noticed before and during the period in which they were profiting from the Option Sellers operation.
Whether it is a financial advisor or hedge fund manager, we are always troubled that certain investment professionals and other profiteers in the investment world act surprised when the volatility in energy destroys the energy concentrated portfolio they built for their clients. It is like a snake handler acting surprised when they are bitten. In just the last several years, we have represented many investors who have ended up with total destruction in their portfolios due to volatility related to energy. We have been pursuing claims for investors and writing extensively about this as well, in an effort to keep investors from being convinced that the next energy volatility “snake handler” can avoid getting bit, here for some examples.
The Now Famous Cordier Video
With respect to Option Sellers specifically, many of you have now seen the lengthy and strange November 16th video of James Cordier of Option Sellers. James Cordier is the founder of OptionSellers.com, an investment firm specializing exclusively in selling options. He is also the author of McGraw-Hill’s The Complete Guide to Option Selling – recently published in its 3rd edition. Cordier’s market comments are published by several international financial publications and worldwide news services including CNBC, The Wall Street Journal, Fox Business, Reuters World News, Bloomberg Television and MarketWatch. These accolades reflect both the ego-driven operation at Option Sellers and the troubling lack of due diligence that those in the investment world engage in before they promote, endorse and profit from due to self-interested motives.
It is an understatement to say the recent James Cordier video is strange. The video begins with Cordier making individual and vague apologies to a few of his 290 clients. Cordier then proceeds with further apologies and describes (vaguely) how his clients were his family and how they put their trust in his company to navigate the world of investing and leverage their investments. In the Wall Street Journal this week, Cordier said he spoke about the movements in the Crude Oil and Natural Gas Markets and additionally he spoke on the volatility of these markets that cost funds, fund managers, and hedge funds their livelihood. Cordier said he was unable to “navigate” the volatility that hit and it cost him his hedge fund. Among other things we note from his video, which is similar to meltdowns we have seen before both in and out of court, is the self-absorbed focus on “his” livelihood and “his” hedge fund rather than on the client’s money. On that point, we note that the website optionsellers.com has been effectively taken down along with its aggressive social media presence.
His video apology was preceded by a notification to investors of a “Catastrophic Loss Event.” As mentioned earlier, the most troubling component of this notification by Option Sellers is that not only had Option Sellers lost all the money entrusted by all investors, but that investors would also purportedly now owe money to FC Stone due to the leverage involved in the trading strategy. Not surprisingly, Option Sellers blamed natural gas for its collapse despite a history of these types of events in the energy sector.
Our Ongoing Investigation on behalf of Investors
For those of you who follow my weekly video blog, you know that my firm preaches due diligence. That concept applies to professionals such as FC Stone and Midland. This includes due diligence done by what we refer to as gatekeepers who profit from the existence of the entity engaging in the wrongdoing. Due diligence has two levels: the investment strategy; and the investment professional promoting and engaging in the strategy. A number of Option Sellers have contacted us last week, and our investigation of FC Stone as well as Midland is ongoing.
In the case of Option Sellers, one of the most troubling aspects of this current situation is FC Stone’s relentless efforts to quickly bully investors into paying the purported debt. We strongly recommend you speak with an attorney with experience in fighting investment-related companies from both an offensive and defensive perspective before you respond to FC Stone.
Vernon Litigation Group
For the last five consecutive years, Vernon Litigation Group has been named in U.S. News and World Report’s Best Lawyers “Best Law Firms” as a Tier 1 firm for Securities/Capital Markets. The team of lawyers at Vernon Litigation has represented investors throughout the United States for decades in both court and arbitration. The firm invites you to review client testimonials appearing on its website to get a better idea of the value we believe the Vernon Litigation team brings to its representation of investors who have been wronged by unethical and incompetent investment professionals.
If you would like to discuss your rights as an investor in Option Sellers, please call 1-877-649-5394 or contact us by e-mail at firstname.lastname@example.org.