Former VSR Broker Made Unsuitable Recommendations on Non-Traded REITs

Posted on October 2nd, 2014 at 4:40 PM

From the Desk of Jim Eccleston at Eccleston Law Offices:

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

Tags:

Return to Archive

TESTIMONIALS

Previous
Next

I am so blessed to have you and your dynamic team defending me. Your ethics, forward thinking and strategies are amazing.  You guys are the best group of attorneys in the country that I could hire to handle this complicated case.

Cindy C.

LATEST NEWS AND ARTICLES

October 27, 2021
Former LPL Advisor Suspended For Completing 22 Trades Absent Client Consent

The Financial Industry Regulatory Authority (FINRA) has suspended and fined a former LPL advisor who allegedly completed 22 trades on behalf of a client without obtaining written consent. FINRA has issued a $5,000 fine and has suspended Michael Hartlett for 10 days.

October 26, 2021
Former Advisor Fails To Reverse Bar After Alleged $1 Million Theft From RBC

A former RBC Wealth Management advisor lost his bid to reverse an industry bar, according to an appellate decision issued by the Financial Industry Regulatory Authority (FINRA).

October 25, 2021
Firms Walk Thin Regulatory Line In Referring Self-Directed Clients To Advisors

While online trading platforms have surged in popularity during the pandemic, brokerage firms view self-directed investors as a source of new clients.