Russ Kory (CRD# 5901185), formerly a registered broker with David Lerner Associates, has been sanctioned by regulators and named in multiple customer complaints over recommendations involving high-risk, illiquid energy investments. Most notably, Kory has been linked to sales of Energy 11, a proprietary oil and gas limited partnership that has triggered losses for investors across the country.
If you were advised to invest in Energy 11 through Russ Kory or David Lerner Associates, you may have experienced significant losses—and you may have legal options to recover those funds through FINRA arbitration.
Background: Who Is Russ Kory?
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Kory was registered as a broker from 2011 to 2019 with David Lerner Associates, a firm that aggressively marketed proprietary energy-sector investments, including Energy 11 and Energy 12. His license has since lapsed, and he is not currently affiliated with any FINRA member firm.
While active, Kory was responsible for recommending securities and investment strategies to retail clients. In that role, he had a fiduciary obligation to offer suitable advice based on each client’s risk tolerance, financial goals, liquidity needs, and overall investment profile.
FINRA Regulatory Sanctions
In August 2022, Kory entered into a settlement with FINRA, the Financial Industry Regulatory Authority, for violations of its suitability rules.
📌 What did FINRA find?
From August 2015 to September 2019, Kory recommended speculative, illiquid investments—described as “blind pool” limited partnerships—to three customers without having a reasonable basis for believing the investments were suitable.
📌 What were the consequences?
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Suspension: 3 months (September 6 – December 5, 2022)
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Fine: $5,000
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Disgorgement: $7,203 in commissions received from these transactions
Among the investments in question were likely Energy 11 and similar oil and gas partnerships. These recommendations violated FINRA Rule 2111 (Suitability) and Rule 2010 (Standards of Commercial Honor).
This case is part of a broader wave of enforcement actions targeting unsuitable sales of Energy 11 and other high-commission, high-risk proprietary products marketed by David Lerner Associates.
Energy 11: What Went Wrong?
Energy 11 is a non-traded limited partnership created to invest in upstream oil and gas assets. While these types of investments are often marketed for income and tax benefits, they carry serious risks that are not always disclosed upfront to retail investors.
Key Risks of Energy 11:
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Illiquidity: Investors cannot freely sell or redeem shares; redemptions are restricted or suspended entirely.
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High Commissions: Up to 10% of investor capital may go toward sales commissions and offering costs.
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Lack of Transparency: Reporting is often limited compared to publicly traded securities.
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Volatility: Performance is tied to unpredictable energy markets and commodity prices.
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Blind Pool Structure: Investors commit capital before knowing how it will be deployed.
For many investors—especially seniors, retirees, or those seeking capital preservation—Energy 11 may have been wholly inappropriate. If these risks weren’t clearly explained by your broker, you may have been misled.
Customer Complaints Involving Russ Kory and Energy 11
📌 March 2021 Arbitration
An investor filed a FINRA arbitration alleging unsuitable investment advice, misrepresentation, and breach of fiduciary duty, with damages estimated between $350,000 and $750,000. The claim was settled for $45,000 in July 2022.
📌 July 2023 Complaint
A new customer dispute alleged losses related to unsuitable sales of debt securities and energy products such as Energy 12 and potentially Energy 11. The damages sought were nearly $100,000.
These complaints highlight a pattern of alleged misconduct involving energy-sector investments that were unsuitable for the investors’ profiles.
What Legal Options Do Investors Have?
If you invested in Energy 11 based on the recommendation of Russ Kory or any representative at David Lerner Associates, you may be able to pursue compensation through FINRA arbitration. This is a confidential, streamlined process specifically designed to resolve disputes between investors and brokerage firms.
You may have a case if:
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You were not adequately informed of the risks and illiquidity of Energy 11.
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Your account became overconcentrated in speculative energy investments.
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You experienced significant losses due to declining performance or lack of access to your funds.
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You are a retiree or conservative investor for whom these products were clearly unsuitable.
Potential Legal Claims:
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Unsuitable recommendations
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Misrepresentation and omissions
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Failure to supervise
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Breach of fiduciary duty
Even if your investment occurred several years ago, there may still be time to file a claim, especially if you only recently became aware of the losses or misrepresentations involved.
How Haselkorn & Thibaut Can Help
Haselkorn & Thibaut, P.A. is a national law firm focused exclusively on representing investors in disputes against financial advisors and broker-dealers. With more than 50 years of combined experience and a 98% success rate, they are currently investigating cases involving Energy 11, Russ Kory, and David Lerner Associates.
📞 Call 1-888-885-7162
🌐 Or visit investmentfraudlawyers.com for a free case review
There are no out-of-pocket legal fees unless you recover money. If you believe your financial advisor recommended Energy 11 inappropriately, don’t wait. Help may be available.
