Investment Losses – AmFuel Holdings LLC
American Fuel Cell and Coated Fabrics Company (AmFuel) filed for Chapter 11 protection with the U.S. Bankruptcy Court in the Northern District of Texas (Fort Worth Division), according to an announcement on November 27, 2017.
According to court documents, the company has been a U.S. government contractor for over 70 years and provides its products to the commercial market, as well. AmFuel is located in Wichita Falls, TX.
The company is part of a niche market. AmFuel is one of only five domestic companies that manufactures fuel cells in significant quantities for the U.S. Department of Defense (DOD).
According to the company, it has taken steps to streamline its operations and increase profitability but has been unable to successfully reduce costs and restructure finances.
American Fuel Cell indicates estimated assets and liabilities of $1 to $10 million. The Company filed Chapter 11 to expedite its reorganization process, and believes that investment by certain insiders may be the best means of completing a restructuring.
Recovery of Invesment losses in AmFuel Holdings LLC
In 2015, AmFuel filed a Form D to raise capital. Reg D private placement investments such as AmFuel Holdings LLC, are typically sold by brokerage firms in exchange for a large up front commission. High fees can range from 7-10%, as well as additional “due diligence fees” that can range from 1-3%.
Another problem with private placement investments such as AmFuel Holdings LLC is that they involve a high degree of risk. They are typically sold as unregistered securities which lack the same regulatory oversight as more traditional investment products like stocks or bonds. These investments may seem like a good idea, until the dramatic drop in distributions.
Investigating Potential Claims
The White Law Group is investigating the liability that FINRA registered brokerage firms may have for improperly selling high-risk private placements, like AmFuel Holdings LLC to their clients.
Despite the risks of investing in private placements, brokerage firms continue to push this type of investment because of the high commissions associated with their sale and creation.
If you suffered losses investing in AmFuel Holdings LLC, the securities attorneys at The White Law Group may be able to help you by filing a FINRA Arbitration claim against the brokerage firm that sold you the investment.
The Financial Industry Regulatory Authority (FINRA) operates the largest securities dispute resolution forum in the United States, and has extensive experience in providing a fair, efficient and effective venue to handle a securities-related dispute.
To speak with a securities attorney about your recovery 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.
For more information on The White Law Group and its representation of investors in FINRA arbitration claims, visit https://www.whitesecuritieslaw.com.