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Securities Fraud Blog

Greco & Greco, P.C.

W. Scott Greco

Fight Investment Fraud

Greco & Greco's lawyers represent investors to recover losses caused by securities fraud, churning, lack of suitability, negligence, sales of unregistered securities, unauthorized trading, and other misconduct by stock brokers, investment advisors, financial planners and their firms.

For a Free Attorney Consultation, call us at 877-821-5550 orĀ 

New York

David Lerner Associates Fined by FINRA for sale of Apple Reits

As shown by this FINRA Order, FINRA sanctioned David Lerner and Associates for sales of Apple REIT Ten and markups related to municipal bonds and CMO’s.  Of the $14 million in fines and restitution, approximately $12 million is to be paid to affected customers.

The wrongful conduct alleged by FINRA includes the following:  1) failure to do proper due diligence on Apple REIT Ten prior to approving its sale to customers, many of whom were elderly and unsophisticated, 2) misrepresentations of the REITs performance, value, and returns, 3) false statements in sales seminars and letters describing the REITs, 4) improper markups, and 5) supervisory violations.

David Lerner Associates has had a great incentive for the sale of the Apple REITs - it earns 10% on every sale and has sold $7 billion of the REITs since 1996.  These revenues account for 60-70% of DLA’s business according to FINRA.  As stated by FINRA:  “Many of DLAs customers are senior and/or unsophisticated, and DLA solicits customers by general means such as the internet, radio, cold callings, mailings, and open-invitation seminars at senior centers, restaurants, and country clubs.”

Details of the restitution program may be found here.  As stated, the remediation plan does not prevent investors from pursuing additional losses through arbitration.  If you suffered losses in REITs and you would like to discuss your case for free with one of our attorneys, please contact Greco & Greco.

Posted by W. Scott Greco on 10/30/12.
ArbitrationBrokerage FirmsDavid Lerner AssociatesCMOs / CDOsFINRAFraudREITsSecurities FraudState RegulatorsNew YorkSuitabilityPermalink

New York subpoenas firms in mortgage fraud probe

Reuters has reported here that the state of New York has subpoenaed three large Wall Street banks (Merrill Lynch, Bear Stearns, and Deutsche Bank) pursuant to a probe related to the creation of mortgage-backed securities.  The New York probe reportedly is looking into how mortgages were packaged together by Wall Street to create securities sold to investors and the banks’ relationship with credit-rating firms.

Posted by W. Scott Greco on 01/11/08.
Brokerage FirmsBear StearnsDeutsche BankMerrill LynchCMOs / CDOsState RegulatorsNew YorkPermalink

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