FINRA Arbitration Panel Orders Sunset Financial To Compensate Client For Private Placement Losses

The Financial Industry Regulatory Authority (“FINRA”) reports that certain investors who experienced losses from private placements have recovered compensation in a lawsuit against Sunset Financial Services Inc. Evidently, that dispute, which clients filed in December of 2017, reportedly concerns Walton Vista Del Monte, Walton West Palmilla and other REITs or DPPs. Here’s more about the lawsuit including the securities that have supposedly resulted in the clients’ losses.

FINRA Arbitration Panel Awards Damages To Sunset Financial Investors For Bad REIT, DPP Transactions

Evidently, the Statement of Claim in FINRA Arbitration #: 18-01256 alleges that a Sunset Financial Services representative made investment recommendations to the client concerning non-traded REITs and DPPs. Notably, causes of action reportedly include breach of contract, breach of fiduciary duty, omissions, misrepresentation, unjust enrichment and negligent supervision.

Also, the Statement of Claim in Arbitration #: 17-03513 alleges that a Sunset Financial Services securities broker provided unsuitable advice concerning direct participation programs that produced high commissions for the broker. It appears that causes of action in this Arbitration Claim include breach of fiduciary duty, breach of contract, negligence, misrepresentation and more.

Ultimately, the Arbitration Panel decided in favor of the investors. Specifically, the Panel awarded one client $247,185 in compensatory damages, and awarded the other client $43,150 in compensatory damages.

Products Involved In The Lawsuit Reportedly Include Walton Vista Del Monte, Walton West Palmilla

Notably, the investors’ damages resulted from purchases of non-traded REITs and DPPs. Specifically, publicly available information suggests that the clients invested in Walton Vista Del Monte, Walton West Palmilla, UDF III, LEAF Equipment Finance Fund IV and ATEL V.

Evidently, Walton is an international real estate management company that manages more than $3.3 billion in real estate assets. It appears that Walton Vista Del Monte is located in Coolidge, Arizona, and Walton West Palmilla is located in Eloy, Arizona. Reportedly, LEAF Commercial Capital offers flexible equipment financing and growth funding for manufacturers, vendors and businesses. It seems that ATEL Capital Group is involved in equipment leasing, private debt and real estate.

Notably, UDF III, which is a Delaware limited partnership, has been sued by SEC for allegedly violating securities laws. Evidently, this case resulted in $8,275,000 in disgorgement by the company and its executives.

Alternative Investments Contain Risks

Securities brokers and financial advisors are responsible for ensuring that private placements they recommend are suitable for investors and for disclosing all of the risks relating to these investments. Not only that, but the securities brokers must conduct due diligence on investments before making recommendations. Notably, private placements, REITs and equipment leasing securities carry substantial risks including illiquidity, non-payment of dividends, and loss of principal. For this reason, private placements are generally not intended for conservative investors.

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Losses from buying risky investments including Walton West Palmilla and Walton Vista Del Monte? If so, contact Soreide Law Group at (888) 760-6552 and speak with experienced counsel about a possible recovery of your investment losses. Soreide Law Group represents clients on a contingency fee basis and advances all costs. The law firm has recovered millions of dollars for clients who have suffered losses due to misconduct of brokers and financial advisors.