Investors looking to invest their life savings for retirement often rely on a trusted advisor to help them select appropriate investments. While most advisors will typically recommend appropriate investments, sometimes investment professionals abdicate their duties to clients and instead select and recommend to investors products that offer higher sales commissions for the advisor, even if such products are unsuitable for the investor.
Such unsuitable recommendations, of products that may not necessarily have any problems but may be too risky for the particular investor or otherwise have features that make them inappropriate investments, could wreak havoc in an investor’s portfolio and wipe out a substantial portion of his or her life savings.
The Financial Industry Regulatory Authority (FINRA), which provides investment advisers and stockbrokers with the guidelines on which to advise investors requires licensed investment professionals to have a reasonable belief that they are only recommending suitable investments to their clients. This regulation is important because not all investment opportunities are appropriate for all investors.
One of the classes of investments that may be particularly problematic for many investors are untraded REITs. Because they are untraded, those REITs are typically subject to less scrutiny from industry watchdogs such as investment analysts, they are usually illiquid and cannot be easily sold if the investor needs money or wants to get out of that investment, and their price often does not always reflect the true value of the investment the same way that traded investments do.
While there may not necessarily be anything wrong with any particular REIT, these and other features might make such REITs unsuitable investments for many investors. Investment professionals who improperly recommend such REITs to their customers may be liable to those customers for unsuitable recommendations.
The investor rights lawyers at Goldman Scarlato & Penny are currently investigating potentially improper investment recommendations by investment advisors in Hines Global REIT, an affiliate of Intelligent Real Estate Investments and Hines Interests Limited Partnership.
REIT losses attorney Alan Rosca of the Goldman Scarlato & Penny PC law firm, is investigating activity related to potentially unreasonable investment recommendation by certain financial advisors who sold Hines Global REIT investments to their customers.
Investors whose brokers improperly sold them REIT investments without a reasonable basis may have a claim and are encouraged to contact attorney Alan Rosca with any useful information or for a free, no-obligation discussion about their options.
Many Real Estate Investment Trusts (REITs) are improperly recommended to investors by brokers as offering a stable income without much risk. Some advisors assure their customers that those REITs offer reliable distribution payments because they receive a steady income flow through rent payments by their tenants.
However, sometimes the investment advisors or brokers fail to caution their investors about the volatility of the various real estate markets and their susceptibility to suffer losses during industry downturns, such as the one caused by the COVID-19 and the imposing of social distancing rules. While many publicly registered REITs can be traded, in cases of privately owned REITs, investors cannot trade them and are often stuck with those investments and unable to sell them and cash out.
Because such REIT investments may sometimes be unsuitable and inappropriate for the investors, they often offers the investment advisor or stockbroker a larger commission than other, more traditional investments, meaning that it is financially advantageous for brokers to push these REITs.
Under the securities industry rules, brokers or investment advisors are required to investigate different types of investments alongside the background of the investors to ensure a suitable match based on age, income, experience with the stock market, risk tolerance, and how much investors can reasonably afford to lose.
They are also required to inform investors of the volatility and other problematic features of the recommended investments. Investment professionals who recommend unsuitable investments or otherwise fail to make full disclosure of potential risks and caution the investors about problematic features of those investments may leave themselves open to potential claims from the investors who have lost money or assets due to such ill-advised and unsuitable recommendations.
Potentially unsuitable investment recommendations in Hines Global REIT by investment advisors are currently being investigated by Goldman Scarlato & Penny.
The Goldman Scarlato & Penny PC law firm represents investors who lose money as a result of investment-related misconduct and are currently investigating alleged unreasonable investment recommendation by financial advisors, involving Hines Global REIT.
The firm takes most cases of this type on a contingency fee basis and advance the case costs, and only gets paid for their fees and costs out of money recovered for clients. Attorney Alan Rosca, a securities lawyer and adjunct professor of securities regulation, has represented thousands of victimized investors across the country and around the globe in cases ranging from arbitrations to class actions.
If you believe that you or a loved one have lost money as a result of unsuitable recommendations concerning Hines Global REIT investment by your brokerage firm or financial advisor, you may contact attorney Alan Rosca for a free no-obligation evaluation of your recovery options, at 888-998-0530, via email at firstname.lastname@example.org, or through the contact form on this webpage. Anybody who has useful information relating to potentially unsuitable recommendations concerning Hines Global REIT investment is also encouraged to contact Goldman Scarlato & Penny PC .