Recovery of Redwood Mortgage Investors VIII

Friday, March 28th, 2014

Have you suffered financial losses as a result of your purchase of Redwood Mortgage Investors VIII (RMI VIII)? If so, The White Law Group may be able to help you recover your investment losses through a FINRA arbitration claim against the broker dealer that recommended this product.

According to Redwood’s website, the company, founded in 1978, is a mortgage lender that provides ” tailor-made loan solutions secured by residential, multi-family, commercial and mixed-use properties [.]’ The loans are secured by California real estate and funded through mortgage pools.

Investors who purchased RMI VIII bought the limited partnership at $1.00 per unit. Unfortunately for investors, according to lpsales.com, recent sales on the secondary market value RMI VIII units at around $0.27/unit.

According to a letter to investors, “In March 2009, to conserve the partnership’s cash and to build cash reserves, withdrawals of limited partners’ capital were suspended and monthly cash distributions were reduced.”The letter goes on to state that it was necessary for all assets to remain invested.

Limited partnerships, especially real estate investments, are complex high risk products that are typically intended for sophisticated and institutional investors. Unfortunately some brokers downplay the risk and mislead investors into thinking these are “safe” investments. Limited partnerships are arguably unsuitable for most investors, especially conservative investors.

Broker dealers have a fiduciary duty to perform adequate due diligence to determine that investments have a reasonable likelihood of success. In addition, broker dealers are required by FINRA to sell limited partnerships only to accredited investors that meet suitability standards. The investors’ age, risk tolerance, net worth, and investment experience should be taken into account in order to determine whether a particular investment recommendation is suitable.

Brokers that overlook FINRA suitability requirements or mislead investors regarding risks can be liable for investment losses through FINRA arbitration.

To determine whether you may be able to recover investment losses incurred as a result of your purchase of RMI VIII or another Redwood Mortgage Investors partnership, please contact The White Law Group at 312-238-9650 for a free consultation.

The White Law Group, LLC is a national securities fraud, securities arbitration, investor protection, and securities regulation/compliance law firm with offices in Chicago, Illinois and Boca Raton, Florida.

For more information on The White Law Group, visit www.WhiteSecuritiesLaw.com.

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