In May 2012, the Financial Industry Regulatory Authority ordered David Lerner Associates Inc. to pay claimants Florence Hechtel and Joseph Graziose $24,450 following the return of their Apple REIT Nine shares to the firm. According to securities arbitration lawyers, this could be the first of possibly hundreds of securities arbitration proceedings that are related to David Lerner Associates Inc. and its sale of Apple REITs.
The fourteenth largest non-traded REIT in the United States, Apple REIT Nine is only one of the Apple REIT investments involved in recent arbitration claims. Apple REIT Six, Apple REIT Seven and Apple REIT Eight are also involved in current and potential claims. Since 1992, David Lerner Associates allegedly sold almost $7 billion in Apple REITs, according to FINRA. As a result, stock fraud lawyers believe many more claims could potentially be filed on behalf of David Lerner clients.
With respect to David Lerner’s sales practices of Apple REITs, FINRA launched an investigation in May 2011 and class actions were filed in June 2011 with similar allegations. Recently, David Lerner allegedly changed the way the REITs are valued on account statements, stating that they are “unpriced.” This is the first time it has been acknowledged that the value of the Apple REIT shares may not be the same as what investors paid, according to securities arbitration lawyers. Furthermore, clients who requested a redemption prior to the last quarterly deadline on June 20, 2011 were allegedly informed that only a partial redemption was possible and the only known offer of purchase for Apple REIT shares is allegedly $3 per share, despite the alleged book value of around $7 per share.
If you have invested in Apple REITs, 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.