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Our experts frequently write blog posts about the findings of the research we are conducting.

Displaying 51-60 out of 66 results for "REIT".

SEC Charges KCAP Financial with Overvaluing Assets

(Nov 2012)

The SEC alleges that KCAP Financial, a publicly traded business development company (BDC), did not accurately report the fair value of its corporate debt and collateralized loan obligation (CLO) assets during the financial crisis, thereby misleading investors. According to the press release, KCAP valued some of their assets at cost, not at fair market value, overstating the net asset value by over 25% during the peak of the financial crisis.

BDCs are similar to REITs in that they hold...

Leveraged Exposure to the Mortgage REIT Sector

(Oct 2012)

Michael Aneiro over at Barron's pointed out an interesting recent SEC 424(b)2 filing from ETRACS for their Monthly Pay 2x Leveraged Mortgage REIT ETN (MORL). According to the prospectus, the ETNs will "provide a monthly compounded two times leveraged long exposure to the performance of the [Market Vectors Global Mortgage REITs Index], reduced by the Accrued Fees." This ETN is essentially a leveraged version of Market Vectors Mortgage REIT ETF (MORT) which tracks the same underlying index.

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FINRA Fines and Suspends David Lerner for Apple REIT Ten Misrepresentations

(Oct 2012)

Today, FINRA fined David Lerner Associates $14 million, including $12 million in restitution to investors, for charging excessive markups and misleading investors in a non-traded real estate investment trust (REIT) known as Apple REIT Ten. They also suspended David Lerner himself for one year from the securities industry and for two more years from acting as principal for a securities firm. From the news release:

As the sole distributor of the Apple REITs, DLA solicited thousands of...

SEC Litigation Releases: Week in Review - October 5th, 2012

(Oct 2012)

SEC Charges Unlicensed Financial Advisor James S. Quay for Defrauding Investors in Atlanta Area
October 4, 2012, (Litigation Release No. 22506)
According to the complaint (opens to PDF), James S. Quay, along with his brother Jeffrey A. Quay, conducted a scheme in which they convinced two elderly women to invest $560,000 into a sham limited partnership called Trinity Charitable Solutions. Quay, who has a history of defrauding the elderly, claimed the funds would be used to operate the program,...

Big Wall Street Firms Pressure Their Salesmen to Favor House-Brands

(Jul 2012)

Financial advisors and brokers are bound by ethical guidelines to analyze and recommend investment products that are suitable and appropriate for their clients' investment objectives and tolerance for risk. In general, they are obliged to put their clients' best interests ahead of their own.

The New York Times reported Monday on the recent admission from a former JPMorgan mutual fund advisor that he sold JPMorgan funds over similar offerings from outside JPMorgan for no other reason than to...

SEC Investigation into Largest Non-Traded REIT May Be A Sign of Things To Come

(May 2012)

As discussed in the financial press (see articles from InvestmentNews and Wall Street Journal) and the company's latest quarterly reports, Inland American Real Estate Trust is the subject of an ongoing SEC investigation. The SEC probe is determining whether the company incurred in any violations of the federal securities laws with regards to its fees, company organization structure, distributions paid to investors, and reported property impairments. Inland American is the largest non-traded...

SEC Litigation Releases: Week in Review - May 11th, 2012

(May 2012)

Georgia Doctor Consents to Order in Settlement of SEC Insider Trading Charges
May 10, 2012, (Litigation Release No. 22364)
In a September 2010 complaint (Litigation Release No. 21644), the SEC alleged that Dr. Bobby V. Khan traded Sciele Pharma, Inc. (a Georgia-based pharmaceutical company) stock based upon material non-public information concerning a tender offer that was to be made by a Japanese company. Yesterday, the US District Court for the Northern District of Georgia entered a consent...

The Small Price of Big Favors

(May 2012)

Yesterday the Securities and Exchange Commission issued a press release announcing that it had filed a complaint alleging Detroit officials -- including former mayor Kwame M. Kilpatrick and former city treasurer Jeffrey W. Beasley -- influenced the city's pension fund investments to favor an advisor, MayfieldGentry Realty Advisors LLC, in exchange for personal gifts. This story illustrates an all too common occurrence in municipal finance. According to the SEC, Kilpatrick and Beasley...

The "New" Non-Traded REITs Look a Lot Like the Old Ones

(May 2012)

Yesterday's Wall Street Journal had an article describing the "new versions" of non-traded real estate investment trusts (REITs), which purport to solve some of the transparency issues which have made non-traded REITs the subject of regulatory scrutiny. In particular, several non-traded REITs are now offering daily updated net asset values (NAV) in an attempt to calm concerns regarding the lack of transparency in the pricing of non-traded REITs.

However, a review of the prospectus for...

Latest Non-Traded REIT Valuations: Not Good...

(Apr 2012)

Non-traded REITs are real estate investments sold to retail investors despite significant liquidity, transparency, and other risks. We've done a great deal of work on non-traded REITs (including a paper and blog posts), and have warned that their dividend payments and debt levels are often not sustainable. Almost all non-traded REITs are reported in customer accounts at acquisition cost, despite widespread declines in real estate values.

FINRA has recently required non-traded REITs to report...

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