Concerned about Investment Losses in TSWR Development LLC?
Tiburon Saltwater Disposal Wells Private Placements Investigation
Have you suffered losses investing in TSWR Development LLC? If so, The White Law Group may be able to help you recover your losses by filing a FINRA Arbitration Claim against the brokerage firm that sold you the investment.
TSWR Development has invested and developed saltwater disposal well operation properties throughout the Permian Basin in West Texas since 2012. The company is a joint venture between Sandlapper Capital Investments and Tiburon Research Holdings.
According to the Financial Industry Regulatory Authority (FINRA) the regulator filed a complaint in 2017 against Sandlapper Securities, LLC, as well as two brokers, reportedly accusing them of willfully defrauding investors by selling interests in the saltwater disposal wells at “excessive, undisclosed markups,” which allegedly totaled over $8 million in the firm’s Tiburon Saltwater Reclamation Fund I, purportedly sold through TSWR Development, LLC at allegedly artificially inflated prices. The brokers were reportedly also accused of fraudulent misrepresentation, omission of material facts, and breach of fiduciary duty.
According to SEC filings, TSWR Development LLC raised capital in 2015-2016, through Form D private placements.
The company reportedly acquired several undivided fractional working interests in four operational saltwater disposal wells to lease these interests back to an affiliate of the sponsor in order to become the master tenant responsible for making lease payments to the DST beneficial interest owners.
According to DST Properties 1031, the four simple salt water disposal facilities are located in the Permian Basin Region of West Texas and consist of undivided fractional working interests in:
The Market SWD salt water disposal facility in Dawson County, TX;
The Clark SWD salt water disposal facility in Reeves County, TX;
The Toms SWD Well #1D salt water disposal facility in Andrews County, TX; and
The Moreland SWD salt water disposal facility in Midland County, TX.
The Problem with Alternative Investments
The trouble with alternative investment products, such as TSWR Development LLC offerings, 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 and bonds.
Broker dealers that sell alternative investments are required to perform adequate due diligence on all investment recommendations to ensure that each investment is suitable for the investor in light of the investor’s age, risk tolerance, net worth, financial needs, and investment experience.
However, another unfortunate by product of Reg D private placements is that the high sales commission brokers earn for selling such products may provide some brokers with enough incentive to push the product to unsuspecting investors who do not fully understand the risks of these types of products.
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.
To determine whether you may be able to recover investment losses incurred as a result of your purchase of TSWR Development LLC or another private placement investment, 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. For more information on the firm, visit www.WhiteSecuritiesLaw.com.