Former VSR Broker Made Unsuitable Recommendations on Non-Traded REITs
Since the real estate crisis of 2008, non-traded real estate investment trusts have been in the regulators’ sights because of questions about their fees, transparency and performance during the credit crisis. Even though FINRA has implemented new polices to better protect investors, the problems and abuses of the past still cannot be ignored.
That fact is illustrated by a new FINRA regulatory complaint filed against a former VSR Financial broker, Steven Stahler. He sold three senior clients high-risk private placements as well as non-traded REITs. From 2006 to 2009, Stahler made unsuitable recommendations to all three clients and directed almost $2.5 million into the alternatives while reaping $165,000 in commissions. Meanwhile, the clients racked up unrealized losses of almost $1.32 million, or 52.8% of the money invested. The clients would have been better off investing in a low-cost, passive index of large capitalization stocks, according to the regulatory complaint.
The dangers to investors from illiquid alternative investments are abundantly clear. Securities regulators (and attorneys representing investors in arbitration) can help investors with aggressive prosecution of complaints.
The attorneys of Eccleston Law Offices represent investors and advisers nationwide in securities and employment matters. Our attorneys draw on a combined experience of nearly 50 years in delivering the highest quality legal services.
Related Attorneys: James J. Eccleston