Articles Tagged with Inland American REIT

shutterstock_186555158According to the BrokerCheck records kept by Financial Industry Regulatory Authority (FINRA) broker Garyn Angel (Angel) has been sanctioned by the regulator in connection with allegations that Angel participated in two private securities transactions without providing prior written notice to his employing member firm, a practice referred to in the industry as selling away. FINRA also alleged that Angel settled a customer complaint without notifying his firm. In addition to FINRA’s claims Angel has been the subject of at least three customer complaints. The customer complaints against Angel allege a number of securities law violations including that the broker made unsuitable investments, negligence, fraud, and breach of fiduciary duty among other claims. Many of the customer complaints against Angel involve allegations relating to certain non-traded real estate investment trusts (Non-Traded REITs). Those Non-Traded REITs include Wells REIT and Inland American REIT.

From February 1999 through March 31, 2009, Angel was registered with FINRA and associated with brokerage firm Transamerica Financial Advisors, Inc. (Transamerica). Thereafter, Angel became associated with Invest Financial Corporation (Invest) through February 2013.

FINRA alleged that in December 2008, Angel recommended that a Transamerica customer purchase shares of Baron Energy, Inc. (Baron Energy), a pink-sheet traded penny stock that was trading at approximately $.50 per share. After making the recommendation, FINRA found that Angel put the customer in contact with a specific individual at Baron Energy and the client purchased 168,000 shares of Baron Energy for $84,000. According to FINRA, Angel did not provide written notice to Transamerica of his participation in the client’s purchase of Baron Energy.

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shutterstock_130706948The law offices of Gana LLP are investigating claims that broker Angelo Talebi (Talebi) made misrepresentations regarding investments in alternative investments such as Real Estate Investment Trusts (REITs) and oil and gas limited partnerships. Upon information and belief, Talebi is targeting Iranian investors in California. According to Talebi’s BrokerCheck, at least 13 customer complaints have been filed regarding Talebi’s sales practices in FINRA arbitration. Some of the complaints also allege that Talebi unsuitably invested clients in various investments including variable annuities and private placements including KBS 1 REIT, Leaf Equipment finance, Inland American Real Estate Trust, Atlas Resources. Another complaint alleges unsuitable equity investments and excessive use of margin.

From 1999 through December 2012, Talebi was associated with LPL Financial LLC (LPL Financial). Thereafter, until April 2014, Talebi was a registered representative of Royal Alliance Associates, Inc.  Currently, Talebi is associated with Independent Financial Group, LLC.

The investment products that Talebi is alleged to have inappropriately recommended to clients are part of a growing industry trend of placing investors heavily in alternative investments and illiquid products. Many times brokers tell investors that these products are more stable and predictable than the stock market. After the financial crisis many investors were receptive to these sales pitches. However, brokers sometimes fail to disclose that the stability of these investments is artificially generated by the lack of disclosure and trading market for these products. In the cases of REITs and oil and gas private placements investors may only learn years after investing that the value of these assets has fallen substantially and some investors do not know of their losses until the investment goes completely bust.

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The law offices of Gana LLP recently filed a complaint against H. Beck, Inc., on behalf of a client accusing the investment advisory firm of making unsuitable recommendations and failing to properly supervise one of its representatives.

The Claimant in this case is a retired sixty-three year old from Hawaii, who sought to safely invest what was left of his retirement funds, after being hit hard in the down market of 2008. H. Beck, through one of its advisers, offered him high, risk-free returns, which the Hawaii native readily accepted. H. Beck, through one of its advisers,  took nearly two-thirds of Claimant’s retirement savings and put them into the Inland American Real Estate Investment Trust (Inland) and the Lease Equipment Finance Fund 4 (LEAF).

LEAF is a limited partnership. Limited Partnerships are investment vehicles formed to acquire, operate, and sell assets for the benefit of the partners. Investors in Limited Partnerships, also known as limited partners, are entitled to receive distributions of operating cash flow as well as distributions from the sale or financing of assets as outlined in the partnership’s limited partnership agreement. Unlike stocks and bonds, Limited Partnerships are not listed on an exchange. They are illiquid assets with a relatively limited secondary market. Consequently, reliable pricing information is typically very difficult to obtain.

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The Financial Industry Regulatory Authority (FINRA) has brought a complaint against financial advisor Brian H. Brunhaver (Brunhaver) formerly of LPL Financial, LLC (LPL) concerning allegations Brunhaver used an unauthorized e-mail account for communications related to his securities business and committed securities fraud in making oral and written misrepresentations to customers regarding a non-traded REIT.

Brunhaver entered the securities industry in 1994.  From May 1995, until June 2011, he was registered through LPL.  On or about June 2, 2011, LPL filed a Uniform Termination Notice (Form U5) for Brunhaver disclosing that he had been discharged on May 3, 2011.  From August 2011, until December 2011, Brunhaver was registered through Pacific West Securities, Inc.  On or about February 25, 2013, LPL filed an Amended Form U5 disclosing the receipt of a Statement of Claim where certain customers of Brunhaver alleged that he had recommended unsuitable investments in REITs and had made misrepresentations to them while employed by LPL.

In addition, Brunhaver’s BrokerCheck discloses that the broker has at least nine customer complaints filed against him.  The majority of the complaints involve allegations that Brunhaver made unsuitable recommendations and material misrepresentations in the sale of non-traded REITs including Inland American REIT, among others.  LPL has been sanctioned by regulatory authorities for failing to supervise its broker’s sales of non-traded REITs

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