The White Law Group continues to investigate the liability that brokerage firms may have for recommending risky Cabot TIC investments.
According to reports, the principals in Cabot, Carlton P. Cabot and Timothy J. Kroll, have been arrested for allegedly misappropriating more that $17 million of investors money. Cabot and Kroll are accused of defrauding TIC investors from 2008 through 2012. Allegedly, the two men misappropriated funds form the TIC’s and concealed their misappropriations by providing false financial reports and other information to investors.
Housingwire.com reports that Cabot and Kroll transferred money out of bank accounts belonging to the TIC investments into Cabot Investment Properties’ (CIP) operating account. Unfortunately for investors, they used the money in the CIP account for unauthorized purposes, including expensive cars, rental apartments and school tuition. In addition, they perpetuated the fraud by using money from one TIC to support another TIC investment.
Brokerage firms that sell TICs, like Cabot Investment Properties, are required to adequately disclose all the risks associated with any given investment, and to perform adequate due diligence to determine if the investment has a reasonable likelihood of success. Furthermore, firms have a fiduciary duty to recommend investments that are in line with the client’s investment objectives, risk tolerance, age, net worth, investment experience, and liquidity needs.
If you own a Cabot TIC and would like to discuss your litigation options, 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 dedicated to the representation of investors in FINRA arbitration claims against brokerage firms throughout the United States. The firm’s offices are located in Chicago, Illinois and Vero Beach, Florida.
For more information on The White Law Group, please visit the firm’s website at www.WhiteSecuritiesLaw.com.