Michael Anthony Hainsworth, a former North Fort Myers, Florida-based broker employed by Minneapolis, Minnesota-based Ameriprise Financial Services, Inc., submitted a Letter of Acceptance, Waiver and Consent in which he consented to, but did not admit to or deny, the entry of the Financial Industry Regulatory Authority’s (FINRA) findings that he sent emails regarding a non-exchange-traded real estate investment trust (REIT) to potential investors that were misleading, not fair and balanced, and failed to provide a sound basis for evaluating the facts presented. The findings stated that based upon communications with Mr. Hainsworth, the investors invested funds totaling $322,167 in the REIT. Mr. Hainsworth was assessed a deferred fine of $10,000 and suspended from association with any FINRA member in any capacity for 30 business days.
REITs invest in a diversified set of income producing real estate properties and mortgages, and they must distribute 90 percent of net earnings to investors. REITs allow investors to partake in real estate investing without directly owning property, which may lock up large amounts of money for long periods of time. The most popular REITs are publicly traded on a stock exchange such as the New York Stock Exchange (NYSE). They are relatively transparent in their finances and operations and are covered extensively by investment analysts. Non-traded REITs, however, are not listed or registered with securities regulators and are supposed to be available only to accredited investors – $1 million or more in assets or $200,000.00 in annual income. Non-traded REITs disclose their finances publicly and offer shares to the public, but they do not list their shares on an exchange, which is one of many risk factors associated with them.
Stockbrokers, registered representatives, and other financial industry professionals have been known to engage in many types of fraudulent and unlawful behavior which violate industry rules and procedures. In order to protect investors from such misconduct, FINRA rules require broker-dealers to establish and implement a reasonable supervisory system. The implementation of the rules requires supervisors to monitor employees to ensure they comply with federal and state securities laws, securities industry rules and regulations, as well as the brokerage firm’s own policies and procedures. If broker-dealers and their supervisors do not establish and implement these protective measures, they may be a liable to account holders for losses flowing from the misconduct. As a result, account holders who have suffered losses stemming from a broker or registered representative’s fraudulent and unlawful misconduct can bring forth claims to recover damages against broker-dealers like Ameriprise Financial Services, which have a duty to supervise its employees in order to prevent the above-described misconduct.
Have you suffered losses in your Ameriprise Financial Services account due to your registered representative or stockbroker’s misconduct? If so, call Robert Pearce at the Law Offices of Robert Wayne Pearce, P.A. for a free consultation. Mr. Pearce is accepting clients with valid claims against financial professionals for unsuitable recommendations, unlawful trading and/or other unauthorized and illegal conduct.
The most important of investors’ rights is the right to be informed! This Investors’ Rights blog post is by the Law Offices of Robert Wayne Pearce, P.A., located in Boca Raton, Florida. For over , Attorney Pearce has tried, arbitrated, and mediated hundreds of disputes involving complex securities, commodities, and investment law issues. The lawyers at our law firm are devoted to protecting investors’ rights throughout the United States and internationally! Please post a comment, call (800) 732-2889, send Mr. Pearce an email at firstname.lastname@example.org, and/or visit our website at www.secatty.com for answers to any of your questions about this blog post and/or any related matter.