FINRA Arbitration Filed Against VSR Financial Over Investment Losses

The White Law Group announces the filing of a FINRA arbitration claim against VSR Financial involving tenant in common investment losses.
 
 
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• DBSI fraud

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Location:
Chicago - Illinois - US

Nov. 9, 2012 - PRLog -- The White Law Group announces that it has filed a Financial Industry Regulatory Authority (FINRA) arbitration statement of claim against VSR Financial Services.  The claim seeks to recover losses in excess of $1,000,000.

The claim, filed by The White Law Group, was submitted to FINRA Dispute Resolution on behalf of a Texas investor alleging claims for violation of common law fraud, breach of fiduciary duty, negligence, and negligent supervision. The claim further alleges that VSR Financial unsuitably invested the client in three tenant-in-common investments (Plano 1031 Limited Partnership, DBSI Shops at East West Connector, and DBSI North Park II.

Before recommending an investment, a broker-dealer has a fiduciary duty to adequately disclose the risks involved in the investment and to perform the necessary due diligence to determine whether the investment is suitable for the investor.  It is alleged that VSR Financial failed to perform the necessary due diligence on these investments prior to recommending them to these particular investors.

The DBSI TICs are alleged to have been particularly problematic.  It appears that DBSI began encountering liquidity issues as early as 2004.  By 2007, the company was allegedly losing $3 million a month on its properties. That number purportedly increased to $8 million by 2008.

In November 2008, DBSI declared bankruptcy.  In the aftermath of DBSI's bankruptcy filing, state investigators began looking into the actions of the company. The bankruptcy court in Delaware appointed an examiner, Joshua Hochberg, to conduct a detailed analysis of the company aimed at determining its actions prior to becoming insolvent. He is charged with tracking more than $3 billion in DBSI transactions in an attempt to discover the location DBSI resources.

To date it has been discovered that company insiders bilked more than $75 million from the company.  DBSI has also subsequently been the subject of an investigation into fraud and gross mismanagement by the Securities and Exchange Commission.

It is alleged that all of these warning signs were ignored by VSR.

FINRA Dispute Resolution is an arbitration venue for investors with claims against their brokerage firm or financial professional.  It provides investors with an opportunity to attempt to recoup their investment losses and is an alternative to filing such claims in court.

For more information on the claim filed by The White Law Group, please contact the firm's Chicago office at 312-238-9650.

The White Law Group is a national securities fraud, securities arbitration, and investor protection law firm with offices in Chicago, Illinois and Boca Raton, Florida.  For more information on The White Law Group and its representation of investors in FINRA arbitration claims, visit http://www.whitesecuritieslaw.com.
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Source:The White Law Group
Email:***@whitesecuritieslaw.com Email Verified
Phone:312-238-9650
Zip:60618
Tags:DBSI fraud
Industry:Legal, Business
Location:Chicago - Illinois - United States
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