Massachusetts securities regulators have hit Lincoln Financial Advisors Corp. with $841,000 in restitution to clients as well as fines over sales of non-traded real estate investment trusts (REITs). The restitution and fines stem from non-traded REITs sales from 2005 to present. Massachusetts’ investigation showed problems related to the firm’s own policies as well as the state rule that an investor’s purchase of REITs cannot be more than 10% of an investor’s liquid net worth. Lincoln Financial Advisors Corp. spokesman Michael Arcaro said: “We cooperated fully with the examination conducted by the Massachusetts Securities Division, and we are pleased to put this matter behind us.” An excessive concentration of REITs can be a violation of FINRA’s suitability rule. After the investigation of broker-dealer sales practices involving REITs, the Massachusetts Securities Division launched a broader inquiry into the sales of alternative investments to seniors.
REITs invest in a diversified set of income producing real estate properties and mortgages, and they must distribute 90 percent of net earnings to investors. REITs allow investors to partake in real estate investing without directly owning property, which may lock up large amounts of money for long periods of time. The most popular REITs are publicly traded on a stock exchange such as the New York Stock Exchange (NYSE) – they are relatively transparent in their finances and operations and are covered extensively by investment analysts. Non-traded REITs are not listed or registered with securities regulators and are supposed to be available only to accredited investors – $1 million or more in assets or $200,000.00 in annual income. Non-traded REITs disclose their finances publicly and offer shares to the public, but they do not list their shares on an exchange, which is one of many risk factors associated with them.
Have you suffered losses in REITs or other unsuitable investments sold by Lincoln Financial Advisors Corp.? If so, call Robert Pearce at the Law Offices of Robert Wayne Pearce, P.A. for a free consultation.
The most important of investors’ rights is the right to be informed! This Investors’ Rights blog post is by the Law Offices of Robert Wayne Pearce, P.A., located in Boca Raton, Florida. For over , Attorney Pearce has tried, arbitrated, and mediated hundreds of disputes involving complex securities, commodities and investment law issues. The lawyers at our law firm are devoted to protecting investors’ rights throughout the United States and internationally! Please visit our website, www.secatty.com, post a comment, call (800) 732-2889, or email Mr. Pearce at pearce@rwpearce.com or answers to any of your questions about this blog post and/or any related matter.
Robert Wayne Pearce
Robert Wayne Pearce of The Law Offices of Robert Wayne Pearce, P.A. has been a trial attorney for more than 40 years and has helped recover over $125 million dollars for his clients. During that time, he developed a well-respected and highly accomplished legal career representing investors and brokers in disputes with one another and the government and industry regulators. To speak with Attorney Pearce, call (800) 732-2889 or Contact Us online for a FREE INITIAL CONSULTATION with Attorney Pearce about your case.
Rate this Post
Loading...