Securities Fraud Blog
The local Virginia Securities Fraud Lawyers of Greco & Greco are currently representing multiple Virginia customers of Richmond, Virginia based broker John Starke. These claims for investment losses have been filed in FINRA arbitration against Mr. Starke’s brokerage firm, Centaurus Financial.
As shown by Mr. Starke’s FINRA Brokercheck report, found here, in the last two years customers have filed seven complaints against Mr. Starke, most involving allegations of the sale of illiquid, unsuitable, and high-risk investments.
Alternative Investments, which include REITs (Real Estate Investment Trusts), are often sold as an alternative to more traditional stocks, bonds, and stock and bond funds. These higher-risk investments are often touted for their high returns, especially in a low interest rate environment, however those high returns are accompanied with corresponding high risk.
In addition to their often high-risk nature, alternative investments may also have significant liquidity risk. Because they are typically not traded on an exchange, investors may not be able to determine the actual value of the investment, and further if the investment experiences problems, investors may not be able to sell or otherwise get out of the problem investment.
Pursuant to the Virginia Securities Act, financial advisors are required to disclose the risks associated with investments that are being recommended, and the Act provides for an award of rescission or losses, interest, and reasonable attorneys fees.
Prior to recommending the purchase of specific investments or a specific investment strategy to a customer, a stockbroker / financial advisor such as Mr. Starke is required to determine that the investments are suitable to that particular investor (or in the “best interest” of the customer after 2020). A suitability determination is based upon many different factors such as age, investment objectives, risk tolerance, employment situation, needs, income, assets, and investment experience. If an advisor’s recommendations of unsuitable investments result in the investor incurring significant losses, that investor may have a suitability, negligence, and breach of contract claim against the broker and his/her firm.
Generally, retirees and those on a fixed income should not have their life savings concentrated in high-risk illiquid investments due to the risk of loss as well as the difficulties of selling the investments.
Greco & Greco’s local Virginia-based lawyers have been representing Virginia residents for decades in claims against their financial advisors and brokerage firms. If you have suffered losses in unsuitable high-risk and illiquid investments and wish to discuss your potential claims with a local lawyer, please contact Scott Greco for a free attorney consultation about your potential case.
Greco & Greco is investigating investor losses in the following alternative investments:
GWG L Bonds
Moody National REIT
Mobile Infrastructure
Parking REIT
Necessity Retail REIT
American Finance Trust
Silver Star Properties REIT
First Capital Real Estate Trust
Priority Income Fund
American Hospitality Properties Fund
Phoenix American Hospitality
Commonwealth Capital
Hospitality Investors Trust
American Realty Capital Hospitality Trust