Investment fraud lawyers are currently investigating claims on behalf of investors who suffered significant losses as a result of their investment in ArciTerra National REIT. According to ArciTerra National REIT’s Form D filing with the Securities and Exchange Commission, ArciTerra is a real estate investment trust based in Phoenix, Arizona.
REIT Investments like the ArciTerra National REIT typically offer commissions between 7-10 percent, which is significantly higher than traditional investments like mutual funds and stocks. In some cases, the commission generated by these investments can be as high as 15 percent. This higher commission can explain why brokerage firms are motivated to recommend these investments despite their possible unsuitability.
Stock fraud lawyers are investigating the possibility that brokerage firms may be held liable for the recommendation of ArciTerra National REIT. Financial Industry Regulatory Authority rules have established that brokers and firms have an obligation to fully disclose all the risks of a given investment when making recommendations, and those recommendations must be suitable for the individual investor receiving the recommendation given their age, investment objectives and risk tolerance. Non-traded REITs are illiquid and inherently risky and, therefore, not suitable for many investors.
Furthermore, the ArciTerra National REIT reportedly offered private placements in order to raise capital. These private placements were then offered by broker-dealers registered with the Financial Industry Regulatory Authority. According to investment fraud lawyers, because private placements are typically more complicated and carry more risk than other traditional investments, they are usually only suitable for sophisticated, high-net-worth investors.
If you suffered losses in the ArciTerra National REIT, another risky REIT, or were unsuitably recommended private placements, you may have a valid securities arbitration claim. 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.