Recent reviews by FINRA of communications with the public regarding real estate programs have revealed deficiencies. For example, some communications have contained inaccurate or misleading statements regarding the potential benefits of investing in real estate programs. Other communications have emphasized the distributions paid by a real estate program and failed to adequately explain that some of the distribution constitutes return of principal. In addition, some communications have not provided sufficient discussions of the risks associated with investing in the products in order to balance the presentation of benefits.As we discussed last week, one of the issues with non-traded and private REITs is that their market value is unknown. For example, most non-traded REITs were sold at a constant share price (typically $10) even through the real estate collapse of 2007-8. Some broker-dealers described this 'lack of volatility' as a feature, 'protecting' investors from 'market fluctuations.' In actuality, the assets of the non-traded REITs' were declining in value, but such declines were masked by the constant offering price. FINRA's new guidelines specifically prohibit this type of misrepresentation.