Couple’s FINRA Arbitration Claim Seeks Up to $500K in Damages
A retired couple from Payson, Utah have filed a Financial Industry Regulatory Authority (FINRA) arbitration claim against Woodbury Financial Services over losses they sustained while investing in GPB Capital Holdings LLC, CIM REIT, and other privately traded entities. Now, they are seeking up to $500K in damages.
Our investment fraud lawyers are representing these investors in their FINRA arbitration claim against Woodbury. This is one of many securities cases we have filed against the broker-dealers that enriched themselves in the alleged $1.7B Ponzi scheme. The hearing will take place in Salt Lake City, Utah.
Investors Were Unsuitably Advised to Invest in GPB Private Placements
The claimants, an older couple, entrusted their savings to their Woodbury financial advisor, whom they met after responding to an advertisement. The brokerage firm and its registered representative presented themselves as experts who could offer income strategies while avoiding unnecessary risk. They promised these inexperienced investors a solid financial plan with little risk that would provide income and return of principal.
Instead, Woodbury and its broker implemented an overly aggressive portfolio strategy that was unsuitable, didn’t have a proper allocation, and was concentrated. Not only that, but they placed most of the couple’s portfolio in private placements, including those from GPB Capital Holdings, which now is the subject of civil and criminal charges alleging fraud.
The claimants’ $200K investment in GPB private placements is now essentially worthless. Meanwhile, Woodbury earned high commissions from selling these investments to them.
Woodbury Financial Services also invested a significant portion of these investors’ accounts in privately traded real estate investment trusts (REITs), including CIM REIT and other entities that were not generally suitable for retirees.
Failure to Supervise by Woodbury Financial Services
The gross lack of supervision of this couple’s portfolio was simply inexcusable. No meaningful communication occurred with any supervisor nor was there proper compliance until it was too late. No reasonable supervisor would have approved recommending private placements to conservative, retired investors.
The proper safeguards to protect customers from concentration also appeared to have been lacking. This is unfortunate considering that Woodbury Financial Services had a duty to make sure that the clients’ account was regularly monitored for compliance and suitability.
Now, these Utah investors are alleging misrepresentations and omissions, fraud, negligence, breach of contract, and unsuitable recommendations. They contend that Woodbury concentrated their account in risky untraded and unregistered products rather than the kind of secure investments they sought.
For example, GPB inventors, like all private placement investors, needed to be accredited investors. They should have been able to understand the kinds of risks involved with these investments. This elderly couple were unsophisticated investors. They lacked the kind of risk tolerance level or portfolio to be able to withstand the risks involving GPB Capital Holdings even if it had never turned out to be a scam.
Seasoned GPB Investor Attorneys
SSEK Law Firm represents retirees, retail investors, inexperienced investors, institutional investors, and high-net-worth investors in recovering their losses from the brokerage firms responsible. Even as over 17,000 investors have lost more than $1.7B in the GPB Ponzi scam, dozens of brokerage firms have enriched themselves from the high fees and sales commissions they earned.
Our GPB private placement lawyers are fighting for many of these investors who were unsuitably recommended GPB funds. Call us at (800) 259-9010 today.