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June 25, 2018 Comments (0) Blog, Current Investigations

FS Credit REIT – Investigating Potential Claims

FS Credit REIT

FS Credit Real Estate Investment Trust – FS Credit REIT

The White Law Group continues to investigate potential claims involving broker-dealers who may have improperly recommended high risk non-traded REITs such as FS Credit REIT to investors.

The offering was declared effective in September 2017, when FS Investments, the sponsor of non-traded BDCs, launched a $2.5 billion commercial mortgage nontraded REIT, FS Credit Real Estate Income Trust (FS Credit REIT).

The REIT was organized as a daily NAV REIT investing primarily in floating rate senior loans secured by commercial real estate properties.

Its investment objective is to “Generate an alternative source of income, preserve capital and realize long-term appreciation,” according to the FS Investments website.

According to recent filings with the SEC, FS Credit REIT is planning to modify its current offering to switch from a daily NAV REIT to a monthly NAV REIT.

The company would issue monthly share valuations and repurchase shares on a monthly basis, instead of a daily basis. The company does not plan to change its investment objectives or strategies, or the overall amount of liquidity to be offered under its share repurchase plan.

The company believes that the change will “allow greater access to capital to execute on its investment strategy.”

Risks of Non-traded REITs

Compared to traditional investments, such as stocks, bonds and mutual funds, non-traded REITS, like FS Credit REIT, are considerably more complex and involve a high degree of risk. Unfortunately many investors were not made adequately aware of the risks and liquidity problems associated with REITs.

The White Law Group has represented numerous investors in claims against the brokerage firm that recommended non-traded REITs.

Broker dealers are required to perform adequate due diligence on any investment they recommend and to 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.

Broker dealers that fail to adequately disclose risks or make unsuitable investment recommendations can be held liable for investment losses.

If you have invested in FS Credit REIT and would like to speak to a securities attorney about the potential to recover your investment losses, please call 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 Vero Beach, Florida.

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