In a recent article from InvestmentNews, it was reported that in a Financial Industry Regulatory Authority Inc. (FINRA) arbitration two claimants were awarded $2.66 million in damages due to losses from the sale of nontraded real estate investment trusts (REITs) and annuities.
According to the FINRA award, the two claimants filed the FINRA claim against First Allied Securities Inc and two other broker/dealers (which were listed in the FINRA award as National Planning Corporation and SagePoint Financial, Inc), in 2018, alleging negligence, misrepresentation, failure to supervise and other charges.
The causes of action listed in the FINRA award relate to the following investments, including, but not limited to: Ridgewood Energy; Griffin Capital Essential; Griffin-American Healthcare REIT III; American Realty Capital Healthcare Trust II; Hospitality Investors Trust Inc. (f/k/a ARC Hospitality Trust, Inc.); Global Net REIT (f/k/a ARC Global); Northstar Healthcare Income, Inc.; Cole Capital; UIT Advisors Bond Fund; Metlife Annuity; Midland Annuity; Jackson Life Annuity; and AXA Annuity.
According to the FINRA decision, only First Allied Securities Inc, which is one of the Cetera Financial Group broker/dealers, was listed as responsible for damages to the two claimants.
The amount awarded to the two claimants, $2.66 million in damages, was the amount requested by the claimants. The claim centered on these high-commissioned products.
Broker/dealers have an obligation to their clients to make suitable recommendations according to the level of risk for the client. There are risks involved with purchasing REITs, especially with the non-exchange traded REIT. A non-traded REIT does not trade on a stock exchange, and is an illiquid investment. All investors should be made aware of the risks involved before purchasing these products.
If you’ve suffered investment losses with First Allied Securities Inc or any other broker/ dealer in the sale of non-traded REITs or annuities, contact Soreide Law Group and speak to an experienced securities lawyer at no cost regarding the possible recovery of your financial losses through a FINRA arbitration at: 888-760-6552.
Soreide Law Group works on a contingency fee basis and represents our clients nationwide before FINRA.
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