Following a Financial Industry Regulatory Authority news release issued on November 5, 2012, securities arbitration lawyers are investigating potential claims on behalf of the customers of WR Rice Financial Services and Joel Wilson. According to the release, a Temporary Cease-and-Desist Order has been filed against WR Rice Financial Services, a Michigan-based firm, and its owner Joel Wilson in order to prevent conversion of investors’ assets or funds and further fraudulent sales activities.
A complaint against Wilson and WR Rice was also issued by FINRA that charges Wilson and his firm with fraud related to the sales of limited partnership interests. These interests are affiliated with the American Realty Funds Corporation and Diversified Group, both of which are companies that Wilson controls and in which he has ownership interest. The Temporary Cease-and-Desist Order is based on the belief that ongoing depletion of customer assets and customer harm is likely to continue before the completion of a formal disciplinary proceeding.
According to the allegations in FINRA’s complaint, “WR Rice, Wilson and other registered representatives at the firm sold more than $4.5 million in limited partnership interests to approximately 100 investors from predominantly low- to moderate-income households, while misrepresenting or omitting material facts.”
Furthermore, WR Rice and Wilson allegedly promised that proceeds from the raised funds would be invested in land contracts which would pay a 9.9 percent interest rate. However, the funds were allegedly used for unsecured loans to companies that were controlled or owned by Wilson. As the loans became due, Wilson and WR Rice were then unable to pay the improper loans and, as a result, failed to disclose the loans to investors. Stock fraud lawyers say that this fraud resulted into significant, but potentially recoverable, losses for investors.
Securities arbitration lawyers encourage customers of Wilson and WR Rice to consider securities arbitration as a possible avenue for recovering losses sustained as a result of fraud. Possible sanctions faced by Wilson and WR Rice include fine, censure, a restitution payment order and suspension and/or bar from the securities industry. Though a complaint has been filed, this action represents only the initiation of formal proceedings. Therefore, no official findings or decisions have been made as of yet.
If you are a client of WR Rice, you may be able to recover losses through securities arbitration. To find out more about your legal rights and options, contact a stock fraud lawyer at The Law Office of Christopher J. Gray at (866) 966-9598 for a no-cost, confidential consultation.