Recovery of Investment Losses in Business Development Corporation of America
Have you suffered investment losses in Business Development Corporation of America (BDCA)? 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.
Business Development Corporation of America is a non-traded business development company that invests in both the debt and equity of private middle market companies.
Bad News for Investors
Recently MacKenzie Capital Management, LP, has extended a tender offer to investors for $6.00 per Share until May 5. In the recent offer, MacKenzie claims Business Development Corporation of America is not required to complete a liquidity event by a specified date.
The company’s estimated net asset value was $8.58 per share as of September 30, 2016, or $0.39 per share lower than the valuation as of December 31, 2015. Additionally, the share repurchase program is oversubscribed. In a tender offer that expired in December 2016, 17 million shares were submitted for tender. The company, however, purchased just over 6.7 million of these shares. Repurchases are only made semi-annually. Thus, it is unlikely that you will be able to sell your entire investment through BDCA’s repurchase program.
The White Law Group continues to investigate the liability that brokerage firms may have for improperly selling high-risk private placements like Business Development Corporation of America.
The Problem with Reg D Private Placements
Broker dealers that sell alternative investments are required to perform adequate due diligence on all investment recommendations. They must ensure that each investment recommendation that is made is suitable for the investor in light of the investor’s age, risk tolerance, net worth, financial needs, and investment experience.
The problem with Reg D private placements is that the high sales commissions and due diligence fees the brokers earn for selling such products sometimes can provide brokers with an enormous incentive to push the product to unsuspecting investors. These investors do not fully understand the risks of these types of investments, and the brokers often focus on the income potential while downplaying the risks.
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 found 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 Business Development Corporation of America (BDCA), please contact 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 Franklin, Tennessee. The firm represents investors throughout the country in claims against their brokerage firm.
For more information on the firm and its representation of investors, visit www.WhiteSecuritiesLaw.com.