March 9, 2016 Comments (0) Blog, Securities Fraud

ATEL 16, LLC – Investment Loss Investigation

(Last Updated On: May 9, 2016)

Have you suffered investment losses in ATEL 16, LLC? If so, the securities attorneys of The White Law Group may be able to help you recover your losses by filing a FINRA Dispute Resolution claim against the brokerage firm that sold you the investment.

According to the prospectus, ATEL 16 was an investment offering to raise capital to purchase a portfolio of leased equipment, equipment financing transactions and other investments leased to major corporations. ATEL intended to use 87% of the capital it raised from the sale of “units” to purchase its portfolio.

Compared to traditional investments, such as stocks, bonds or mutual funds, the purchase of ‘units” in a Limited Liability Company (LLC), like ATEL 16, are considerably more complex and involve a high degree of risk. Unfortunately many investors were not made adequately aware of the risks and liquidity problems associated with the investment.

The risk factors listed on ATEL 16’s prospectus include:

  • The Fund does not guarantee its distributions or the return of investors’ capital
  • Most of the Fund’s distributions will be, and most of the prior ATEL programs’ distributions have been, a return of capital and not a return on capital
  • No market exists for the Units or is expected to develop, the Fund’s Operating Agreement includes significant restrictions on the transferability of Units, and an investor may be unable to sell his Units or able to sell the Units only at a significant discount
  • The Fund will pay the Manager and its related companies substantial fees
  • The Manager will be subject to certain conflicts of interest

In addition, some brokers may have downplayed the risks associated with the purchase of LLC units and misled investors into thinking that they were “safe” investments. The 9% sales commission brokers earned for selling ATEL 16 may have provide some brokers with enough incentive to push the product to unsuspecting investors.

Broker dealers are required to perform adequate due diligence on any investment they recommend and to ensure that all recommendations are suitable for the investor. Recommendations should be inline with the investor’s age, risk tolerance, net worth, and investment experience.

Broker dealers that fail to adequately disclose risks or make unsuitable investment recommendations can be held liable for investment losses.

If you have invested in ATEL 16 and would like to speak to a securities attorney about the potential to recover your investment losses, please call The White Law Group at 1-888-637-5510 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 Vero Beach, Florida.

To learn more about the White Law Group, visit www.WhiteSecuritiesLaw.com.