Pacific Cornerstone in more trouble.

Tuesday, May 22nd, 2012

Pacific Cornerstone Capital Inc. said in a Securities and Exchange Commission filing at the end of February that it was “involved with an arbitration proceeding before Finra and one Finra investigation.” It didn’t state the specifics of the investigation in the filing, the firm’s annual report of audited financials, known as a Focus report.

Finra fined the firm $700,000 in 2009 for allegedly misstating material facts involved in the sale of private placements, according to the firm’s profile on Finra BrokerCheck.

Pacific Cornerstone, the broker-dealer arm of Cornerstone Real Estate Funds, is the broker-dealer manager of two nontraded real estate investment trusts that recently saw steep devaluations.

In its SEC filing, Pacific Cornerstone said that it didn’t know what the future held regarding the Finra matters.

“Outside counsel for the company has advised that at this stage of the proceedings, they could not offer an opinion to probable outcome of the matters,” the company filing said. “Accordingly, no provision for loss has been recorded in the accompanying financial statements for 2011.”

Pacific Cornerstone’s two REIT offerings have seen significant changes.

In March, Cornerstone Core Properties REIT Inc. told investors that it had been devalued to $2.25 a share, from $8, a 72% drop. That nontraded REIT is relatively small, raising just $158 million of its $439 million target.

The Cornerstone Healthcare Plus REIT Inc. changed its name at the end of last year to Sentio Healthcare Properties Inc. while at the same time replacing the adviser of the fund. That REIT raised $127 million and has a value of $9.02 a share, down from its sale price of $10 a share.

Cornerstone is also involved in a third offering, CIP Leveraged Advisors.  This was a fund that was put together to help Cornerstone raise money for its other ventures.  CIP Leveraged Advisors has also seen steep declines in value.

The White Law Group continues to file FINRA arbitration claims on behalf of Cornerstone investors.  These claims are generally filed against the broker-dealer that recommended Cornerstone to the firm’s clients.

Brokerage firms have a fiduciary duty to perform adequate due diligence on any investment prior to offering it for sale to their clients.  Based on what is known about Cornerstone, it is clear that the brokerage firms that sold it failed to perform the adequate due diligence.

If you are a Cornerstone REIT investor and would like to speak with a securities attorney regarding your litigation rights, please call The White Law Group at 312/238-9650 for a free consultation.

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

For more information on the firm, please visit http://www.whitesecuritieslaw.com.

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Recovery of SCI Real Estate Investment Losses

Monday, May 21st, 2012

Have you suffered investment losses in a SCI Real Estate Investments, LLC’s TIC or other real estate offerings?  If so, The White Law Group may be able to help you recover your losses through FINRA arbitration.

The White Law Group is investigating the liability that FINRA registered brokerage firms may have for recommending SCI Real Estate Investments to their clients.

Brokerage firms have a fiduciary duty to their clients to perform due diligence on an investment prior to offering them for sale to their clients.  Based on what is now known about SCI Real Estate Investments and the firm’s investment offerings, it does not appear that the brokerage firms that sold these products did perform the necessary due diligence.

SCI Real Estate Investments, LLC operates as a real estate company in the United States. It acquires multi-family and retail properties in the United States and offers co-ownership interests in those properties as 1031 exchanges and investments to individual real estate buyers. The company was founded in 1994 and is based in Los Angeles, California. On February 11, 2011, SCI Real Estate Investments, LLC filed a voluntary petition for reorganization under Chapter 11 in the U.S. Bankruptcy Court for the Central District of California.  The confirmation hearing for the firm’s liquidation plan is scheduled for June 13, 2012.

SCI Capital Group Mezzanine Fund is one SCI offering that appears particularly problematic.  The Mezzanine Fund did not invest in real estate but invested in unsecured loans to SCI and its affiliates.  These loans appear likely to be discharged by SCI’s bankruptcy filing.

Other SCI tenant-in-common (TIC) real estate investments have also been adversely effected by the real estate market collapse.

To determine whether you may be able to recover investment losses incurred as a result of your purchase of a SCI Real Estate Investments’ offering, 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 http://www.whitesecuritieslaw.com.

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Valparaiso Financial Advisor Pleads Guilty To Fraud

Monday, May 21st, 2012

According to reports, a Valparaiso, Indiana financial advisor is facing a year in prison after pleading guilty to wire fraud.  The advisor, Jennifer Guelinas, allegedly made unauthorized transfers of more than half a million dollars from a client’s account while working as a financial advisor in the Valporaiso area.

According to court documents, between Dec. 29, 2006, and Nov. 5, 2010, Guelinas transferred in excess of $800,000 from a client’s account into her personal bank account by forging her client’s name on the wire transfer requests.

Guelinas’ FINRA Broker Report indicates that she was registered with Ameriprise Financial Services during the time of the allegations.

The White Law Group is investigating the liability that Ameriprise may have for failure to adequately supervise Guelinas and her activities.

If you invested with Guelinas and have questions about your investments, please call the securities attorneys of 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, please visit our website at http://www.whitesecuritieslaw.com.

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FINRA Broker Check Enhancements

Saturday, May 19th, 2012

FINRA recently announced that it has added features to its CRD Broker Check system to help users more easily access broker-dealer and investment adviser registration information.

According to the FINRA announcement, users now have:

-  centralized access to licensing and registration information on current and former brokers and brokerage firms, and investment adviser representatives and investment adviser firms;

-  the ability to search for and locate a financial services professional based on main office and branch locations, and the ability to conduct ZIP code radius searches (in increments of 5, 15 or 25 miles); and

-  access to expanded educational content available on BrokerCheck, including new help icons that clarify commonly referenced terms throughout the system and within BrokerCheck reports.

While investors have been able for years to obtain information about, and the disciplinary record of, any FINRA-registered broker or brokerage firm by using FINRA’s BrokerCheck, the updates should make it easier to perform this research.

The foregoing information is provided by The White Law Group.  The White Law Group is a national securities fraud, securities arbitration and investor protection law firm with offices in Chicago, Illinois and Boca Raton, Florida.  The firm represents investors in FINRA arbitration claims against their brokerage firm or financial professional.  These claims often involve various securities fraud violations, including unsuitable investment recommendations in violation of the Know Your Customer Rule, and failure to perform adequate due diligence on the investments recommended.

For more information on The White Law Group, visit http://www.whitesecuritieslaw.com.

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Recovery of Healthcare Trust of America Losses

Friday, May 18th, 2012

Have you suffered investment losses in Healthcare Trust of America, Inc.?  If so, The White Law Group may be able to help you recover your losses through FINRA arbitration.

The White Law Group is investigating potential securities fraud claims involving broker-dealers’ improper recommendation that investors purchase risky non-traded REIT investments, including Healthcare Trust of America.

FINRA recently announced that it is paying close attention to the sale of REITs and, in particular, the ways in which broker/dealers marketed and sold the products to investors. In many cases, and notwithstanding the risk of REIT investments, broker-dealers marketed these investments as safe and secure.

REITs typically pay a high commission – often as much as 15% (which often explains the stockbroker’s motivation in recommending the REIT investment to the investor).

Due to the relatively high interest or dividend offered by non-traded REITs like Healthcare Trust of America, retired investors are often attracted to these products.

According to its website, Healthcare Trust of America is a “fully integrated, self-administered, self-managed real estate investment trust.” Since its formation in 2006, Healthcare Trust of America has invested approximately $2.5 billion in various real estate projects.

In a recent SEC filing, Healthcare Trust of America announced that it would be taking the REIT public, with an anticipated ticker symbol of “HTA.”

Although, Healthcare Trust of America is seeking an IPO price of at least $10.10 per share, according to the filing, in light of Inland Western REIT’s recent IPO and the fact that the market set the share price considerably lower than Inland Western had anticipated, it is certainly possible that Healthcare Trust of America’s initial share price will be lower than anticipated.

The White Law Group’s investigation into the improper sales of non-traded REITs to investors is not limited to Healthcare Trust of America.  The firm is also representing investors in claims against their brokerage firm involving the following non-traded REITs: Behringer Harvard REIT I, Inland America Real Estate Trust, Inland Western Retail Real Estate Trust, Wells Real Estate Investment Trust II, Piedmont Office Realty Trust, Desert Capital REIT, Apple REIT, Crystal River REIT, and KBS REIT.

To determine whether you may be able to recover investment losses incurred as a result of your purchase of a risky REIT investment, 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 http://www.whitesecuritieslaw.com.

 

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