Articles Posted in REITs

shutterstock_182004416-300x200Broker John Oldham (Oldham) was recently sanctioned by The Financial Industry Regulatory Authority (FINRA) in an enforcement action.  According to the FINRA AWC (Letter of Acceptance, Waiver, and Consent 2015046203101) FINRA found that Oldham consented to sanctions that he shared commissions from the sales of alternative investments with an unregistered entity. According to FINRA, Oldham facilitated the sales of the alternative investments totaling more than $4.8 million to customers referred to him and shared commissions with the unregistered entity in the amount of $240,000 for these transactions.  FINRA found that while Oldham executed subscription agreements on behalf of the third-party, in some instances this representation on those forms were inaccurate because Oldham had not communicated with the customer who had executed the subscription agreement.

The securities lawyers of Gana LLP are investigating the regulatory complaint against Oldham.  In addition to the regulatory action, there is one employment termination for cause listed for Oldham alleging possible violation of FINRA Rule 2040.

Our firm often handles cases involving direct participation products (DPPs) and private placements including oil and gas partnerships, non-traded real estate investment trusts (REITs), and other alternative investments.

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shutterstock_175835072-300x199The investment fraud attorneys with Gana LLP are investigating customer complaints filed with The Financial Industry Regulatory Authority (FINRA) against Gary Saitowitz (Saitowitz) currently not associated with any broker-dealer.  According to brokercheck records Saitowitz has been subject to three customer complaints, declared bankruptcy in March 2015, was terminated for cause by Transamerica Financial Advisors, Inc. (Transamerica), and sanctioned by FINRA in January 2017.  Saitowitz’s termination for cause and FINRA sanctions involve his conduct concerning direct participation products (DPPs) such as non-traded real estate investment trusts (REITs) and potentially other alternative investments.

In January 2017, Saitowitz consented to FINRA sanctions that he had customers sign blank and incomplete brokerage forms and that some of the pre-signed forms authorized fund movement or loans from customer accounts, while others related to customer financial information, used by the firm to supervise whether transactions solicited by Saitowitz were suitable for customers. FINRA found that the maintaining of pre-signed forms enhanced the risk that customers would be placed in unsuitable investments or subject to unauthorized account activity.  FINRA also found that his brokerage firm imposed limits on the amount of a customer’s liquid assets that could be invested in non-traded REITs but that in order to circumvent the limits Saitowitz maintained records overstating the liquid net worth of certain customers in connection with sales of non-traded REITs.

FINRA also found that Saitowitz used personal email addresses to conduct securities business in contravention of the firm’s policies and procedures. Finally, FINRA also determined that Saitowitz failed to report a judgment and a tax lien and to timely report five tax liens.

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shutterstock_170709014-225x300Customers have filed complaints and The Financial Industry Regulatory Authority (FINRA) recently barred broker John Hudnall (Hudnall) – formerly with U.S. BanCorp Investments, Inc. (U.S. BanCorp). The securities attorneys at Gana LLP are investing the allegations against Hudnall including unsuitable investments among other claims.  According to brokercheck records Hudnall has been subject to six customer complaints and one criminal matter.  Many of the complaints involve direct participation products (DPPs) and variable annuities such as non-traded real estate investment trusts (REITs) and other alternative investments.

In FINRA’s complaint against Hudnall it was alleged that he participated in an undisclosed and unapproved private securities transaction by selling a REIT investment to an elderly customer which he split into two simultaneous transactions of $40,000 and $360,000. FINRA alleged that Hudnall did this to circumvent his firm’s supervisory review of such a large transaction of this kind.  According to FINRA, the $400,000 REIT investment exceeded the firm’s supervisory thresholds and would have triggered additional supervisory review and likely would have been disapproved. FINRA also alleged that Hudnall made a promotional offer in which he promised to pay certain customers who purchased fixed annuities 1% annual interest if they held their fixed annuities for at least a year, when in fact this offer was not part of the fixed annuity product that he was selling.

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shutterstock_36343294-300x225Customers have filed complaints filed with The Financial Industry Regulatory Authority (FINRA) against IMS Securities, Inc. (IMS) broker Beth Debouvre – a/k/a Beth Bunnell (Debouvre).  The securities attorneys at Gana LLP are investing the allegations against Debouvre including unsuitable investments, breach of fiduciary duty, and misrepresentations among other claims.  According to brokercheck records Debouvre has been subject to three customer complaints.  Many of the complaints involve direct participation products (DPPs) such as non-traded real estate investment trusts (REITs), equipment leasing funds – such as LEAF or ICON, and other alternative investments.  According to Debouvre’s disclosures she conducts business under the d/b/a Grosse Point Financial Services, LLC and Hawthorne Financial LLC.

In May 2016 a customer filed a complaint alleging unsuitable investments and negligence involving non-traded REITs.  The customer claimed damages of $450,000.  The claim is currently pending.

Our firm has represented many clients in illiquid alternative investments products.  All of these investments come with high costs and have historically underperformed even safe benchmarks, like U.S. treasury bonds.  For example, products like oil and gas partnerships, REITs, and other alternative investments are only appropriate for a narrow band of investors under certain conditions due to the high costs, illiquidity, and huge redemption charges of the products, if they can be redeemed at all.  However, due to the high commissions brokers earn on these products they sell them to investors who cannot profit from them and have created a large market for a failed product.  Further, investor often fail to understand that they have lost money in these illiquid investments until many years after investing.  In sum, for all of their costs and risks, investors in these programs are in no way additionally compensated for the loss of liquidity, risks, or cost.

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shutterstock_178801067Our investment attorneys are investigating customer complaints filed with The Financial Industry Regulatory Authority (FINRA) against Paul Neves (Neves) currently associated with Securities America, Inc. (Securities America) alleging unsuitable investments, breach of fiduciary duty, common law fraud, and elder abuse among other claims.  According to brokercheck records Neves has been subject to five customer complaints.  Many of the complaints involve direct participation products (DPPs) such as non-traded real estate investment trusts (REITs), equipment leasing funds – such as LEAF or ICON, and other alternative investments.

In November 2015 a customer filed a complaint alleging unsuitable investments and elder abuse.  The customer claimed damages of $800,000.  The claim is currently pending.

Our firm has represented many clients in illiquid alternative investments products.  All of these investments come with high costs and have historically underperformed even safe benchmarks, like U.S. treasury bonds.  For example, products like oil and gas partnerships, REITs, and other alternative investments are only appropriate for a narrow band of investors under certain conditions due to the high costs, illiquidity, and huge redemption charges of the products, if they can be redeemed at all.  However, due to the high commissions brokers earn on these products they sell them to investors who cannot profit from them and have created a large market for a failed product.  Further, investor often fail to understand that they have lost money in these illiquid investments until many years after investing.  In sum, for all of their costs and risks, investors in these programs are in no way additionally compensated for the loss of liquidity, risks, or cost.

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shutterstock_159036452Our investment attorneys are investigating customer complaints filed with The Financial Industry Regulatory Authority (FINRA) against Raymond Harrison (Harrison) currently associated with Cambridge Investment Research, Inc. (Cambridge) alleging unsuitable investments , lack of due diligence, lack of supervision, and omissions of material information among other claims.  According to brokercheck records Harrison has been subject to six customer complaints and two financial disclosures.  Many of the complaints involve direct participation products (DPPs) such as non-traded real estate investment trusts (REITs), equipment leasing funds – such as LEAF or ICON, and other alternative investments.

In October 2016 a customer filed a complaint alleging unsuitable investments for investment experience and risk tolerance, lack of adequate due diligence in regard to investments, a lack of supervision and the omission of material information.  The customer claimed damages of $603,000.  The claim is currently pending.

Our firm has represented many clients in illiquid alternative investments products.  All of these investments come with high costs and have historically underperformed even safe benchmarks, like U.S. treasury bonds.  For example, products like oil and gas partnerships, REITs, and other alternative investments are only appropriate for a narrow band of investors under certain conditions due to the high costs, illiquidity, and huge redemption charges of the products, if they can be redeemed at all.  However, due to the high commissions brokers earn on these products they sell them to investors who cannot profit from them and have created a large market for a failed product.  Further, investor often fail to understand that they have lost money in these illiquid investments until many years after investing.  In sum, for all of their costs and risks, investors in these programs are in no way additionally compensated for the loss of liquidity, risks, or cost.

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shutterstock_171721244Our investment attorneys are investigating customer complaints filed with The Financial Industry Regulatory Authority (FINRA) against Kenneth Saunders (Saunders) currently associated with National Planning Corporation (NPC) alleging unsuitable investments among other claims.  According to brokercheck records Saunders has been subject to six customer complaints.  Some of the complaints involve direct participation products (DPPs) such as non-traded real estate investment trusts (REITs) and other alternative investments.

Saunders has also disclosed a number outside business activities including his d/b/a Saunders Investment & Tax Advisory Group, Inc., Heron Bay Association, and Parke Place HOA.  The most recent customer complaint was filed in March 2016 and alleged that Saunders recommended unsuitable alternative investments causing $150,000 in damages.  The claim is currently pending.

Our firm has represented many clients wo have invested in Direct Participation Products and REITS.  Many of these types of investments come with high costs and have historically underperformed various benchmarks.  For example, according to FINRA, products like REITs, and DPPs are only appropriate for a narrow band of investors under certain conditions due to the high costs, illiquidity, and huge redemption charges of the products, if they can be redeemed at all.  Further, investors often fail to understand that they have lost money in these illiquid investments until many years after investing. 

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shutterstock_174858983Our investment attorneys are interested in speaking with investors who may have been sold inappropriate alternative investments by Cheryl Kitashima (Kitashima).  Customers have filed complaints with The Financial Industry Regulatory Authority (FINRA) against Kitashima alleging unsuitable investments, breach of fiduciary duty, common law fraud, and misrepresentations among other claims.  According to brokercheck records Kitashima has been subject to five customer complaints.  Some of the complaints involve direct participation products (DPPs), variable annuities, oil and gas investments, non-traded real estate investment trusts (REITs), and other alternative investments.

Our firm has represented many clients in these types of products.  All of these investments come with high costs and have historically underperformed even safe benchmarks, like U.S. treasury bonds.  For example, products like oil and gas partnerships, REITs, and other alternative investments are only appropriate for a narrow band of investors under certain conditions due to the high costs, illiquidity, and huge redemption charges of the products, if they can be redeemed at all.  However, due to the high commissions brokers earn on these products they sell them to investors who cannot profit from them and have created a large market for a failed product.  Further, investor often fail to understand that they have lost money in these illiquid investments until many years after investing.  In sum, for all of their costs and risks, investors in these programs are in no way additionally compensated for the loss of liquidity, risks, or cost.

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shutterstock_132317306The securities lawyers of Gana LLP are investigating customer complaints filed with The Financial Industry Regulatory Authority (FINRA) against Mark Wesley (Wesley) alleging unsuitable investments, negligence, and breach of fiduciary duty among other claims.  According to brokercheck records Wesley has been subject to six customer complaints.  Some of the complaints involve direct participation products (DPPs), oil and gas private placements, variable annuities, non-traded real estate investment trusts (REITs), and other alternative investments.

In June 2016, Ameriprise Financial Services, Inc. (Ameriprise) permitted Wesley to resign alleging that he was under suspension for compliance policy violations related to unauthorized trading, use of discretion in a non-discretionary account, supervision of staff and responding to supervision.

In addition, Wesley has been subject to five tax liens totaling millions of dollars.  A broker’s inability to handle their personal finances has also been found to be relevant in helping investors determine if they should allow the broker to handle their finances.

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shutterstock_191231699The securities lawyers of Gana LLP are investigating a customer complaints filed with The Financial Industry Regulatory Authority (FINRA) against broker Craig Hayward (Hayward).  According to BrokerCheck records Hayward has been subject to at least six customer complaints.  The customer complaints against Hayward alleges securities law violations that including unsuitable investments and misrepresentations among other claims.   Many of the complaints involve direct participation products (DPPs) and private placements including oil and gas partnerships, non-traded real estate investment trusts (REITs), and other alternative investments.

Our firm has represented many clients in these types of products.  All of these investments come with high costs and historically have underperformed even safe benchmarks, like U.S. treasury bonds.  For example, products like oil and gas partnerships, REITs, and other alternative investments are only appropriate for a narrow band of investors under certain conditions due to the high costs, illiquidity, and huge redemption charges of the products, if they can be redeemed.  However, due to the high commissions brokers earn on these products they sell them to investors who cannot profit from them.  Further, investor often fail to understand that they have lost money until many years after agreeing to the investment.  In sum, for all of their costs and risks, investors in these programs are in no way additionally compensated for the loss of liquidity, risks, or cost.

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