Concerned about investment losses in BRS Labs Inc.?
Have you suffered losses investing in BRS Labs Inc.? If so, The White Law Group may be able to help you recover your losses through FINRA arbitration.
Ray Davis founder and former CEO of BRS Labs Inc., and his son Charles Davis, were slapped with a lawsuit in early February. They are being accused by the company, BRS Labs Inc. (now known as Giant Gray Inc.) of allegedly stealing more than $15 million from Davis’ former company for lavish goods and high-end antiques.
The 22-page lawsuit was filed in the Harris County District Court on Feb. 2 on behalf of Giant Gray Inc. by Andrew Edison, a lawyer at Edison, McDowell & Hetherington LLP, alleging fraud and breach of fiduciary duty, among other charges.
BRS Labs Inc., in Houston, TX, which specializes in security analytics, changed its name to Giant Gray in 2016 after Ray Davis resigned from the company. According to the suit, before Davis exited the company he and Charles Davis were given complete access to the company’s financials.
In addition, the lawsuit alleges former CEO Ray Davis and his son Charles Davis used “an elaborate scheme to create fraudulent and forged invoices to make payments to fictitious companies, and by requiring Giant Gray’s payment of personal expenses unrelated to the company’s business” to allegedly take more than $15 million from the company.
The time period of the alleged scheme was between 2005, when BRS was founded, and July 2015, when Ray Davis sold his controlling interest in the firm, according to the suit.
Investigating Potential Claims
The White Law Group is investigating potential securities fraud claims involving broker-dealers’ improper recommendation that some investors purchase BRS Labs, Inc.
BRS Labs Inc. often raised money through Reg D private placements offerings. These Reg D private placements are then typically sold by brokerage firms in exchange for a large up front commission, usually between 7-10%.
However, another problem with Reg D private placements is that the high sales commission brokers earn for selling such products. Sometimes this can provide some brokers with enough incentive to push the product to unsuspecting investors who do not fully understand the risks of these types of investments.
Fortunately, FINRA does provide for an arbitration forum for investors to resolve such disputes. If a broker or brokerage firm makes an unsuitable investment recommendation or fails to adequately disclose the risks associated with an investment they may be liable for investment losses in a FINRA arbitration claim.
To determine whether you may be able to recover investment losses incurred as a result of your purchase of BRS Labs, Inc., please contact The White Law Group at 1-888-637-5510 for a free consultation.