Crown Capital Securities

Advisor Thomas Burns (Burns), formerly employed by Crown Capital Securities, L.P. (Crown Capital) has been subject to at least seven customer complaints and two regulatory actions. According to a BrokerCheck report some of the customer complaints concern alternative investments and direct participation products (DPPs) such as non-traded real estate investment trusts (REITs), oil & gas programs, annuities, and equipment leasing programs. The attorneys at Gana Weinstein LLP have extensive experience handling investor losses caused by these types of products.

In February 2019 FINRA settled a regulatory dispute with Burns where Burns consented to sanctions and an entry of findings that he negligently made numerous mistakes causing errors and inaccuracies in identifying customer assets on alternative investment forms causing his firm to have inaccurate books and records. For instance, FINRA found that Burns mistakenly double counted assets held away from his firm in direct pension benefit plans by placing the individual holdings in their individual categories and by counting them again in the other assets category. FINRA found that Burns made computational errors in adding up holdings when calculating net worth. In addition, FINRA alleged that Burns erroneously understated the amount of existing alternative investment holdings by either unintentionally understating the value of existing tenants in common or rental holdings or by misclassifying those existing holdings as personal real estate, instead of as alternative investments.

According to the BrokerCheck records kept by Financial Industry Regulatory Authority (FINRA) broker Kenneth McDonald (McDonald) has been the subject of at least three customer complaints and one regulatory action. Customers have filed complaints against McDonald alleging a number of securities law violations including that the broker made unsuitable investments, misrepresentations and false statements in connection with recommendations to invest in private placements such as tenants-in-common (TICs) interests.

McDonald was a registered representative with Crown Capital Securities, L.P. from June 2003 through February 2013. Thereafter, McDonald has been registered with Newport Coast Securities, Inc.

TIC investments have come under fire by many investors. Indeed, due to the failure of the TIC investment strategy as a whole across the securities industry, TIC investments have virtually disappeared as offered investments. According to InvestmentNews “At the height of the TIC market in 2006, 71 sponsors raised $3.65 billion in equity from TICs and DSTs…TICs now are all but extinct because of the fallout from the credit crisis.” In fact, TICs recommendations have been a major contributor to bankrupting brokerage firms. For example, 43 of the 92 broker-dealers that sold TICs sponsored by DBSI Inc., a company whose executives were later charged with running a Ponzi scheme, a staggering 47% of firms that sold DBSI are no longer in business.

Articles Tagged with Crown Capital Securities

Thomas Burns Subject to Complaints Over REIT Investments

Broker Investigation: Kenneth McDonald’s Sale of Tenants-in-Common (TIC) Real Estate Investments