Investors in FSIC II may have claims.
The White Law Group continues its investigation involving broker dealers who may have improperly recommended FS Investment Corporation II (FSIC II) to investors. If you are concerned about your investment in FSIC II, the securities attorneys at The White Law Group may be able to help you.
FSIC II is a business development company (BDC).The fund primarily invests in floating rate, senior secured loans of private U.S. middle market companies. The fund’s investment objectives are to “generate current income and, to a lesser extent, long-term capital appreciation,” according to its website.
The trouble with alternative investment products like FSIC II, is that they involve a high degree of risk and are typically sold as unregistered securities which lack the same regulatory oversight as more traditional investment products like stocks or bonds.
Lack of liquidity is often problematic with BDCs. Investors may have trouble finding a buyer, and can suffer significant losses on the sale.
Secondary Market Listing
According to Central Trade & Transfer, a secondary market for private placements, shares of FS Investment Corporation II are currently listed at $7.15 per share. This may be at a loss to investors as the original offering price was $10 per share.
Broker dealers are required to perform adequate due diligence on any investment they recommend. They must ensure that all recommendations are suitable for the investor. Recommendations should be in line with the investor’s age, risk tolerance, net worth, and investment experience.
Despite the risks of investing in alternative investments, brokerage firms continue to push this type of investment because of the high commissions associated with their sale and creation.
If you are concerned about your investment in FS Investment Corporation II or another FS Investments offering and would like to speak with a securities attorney about your options, please call The White Law Group at 888-637-5510 for a free consultation.
The White Law Group is a national securities fraud, securities arbitration, and investor protection law firm with offices in Chicago, Illinois and Vero Beach, Florida.