Recovering Losses caused by Investment Misconduct

David Lerner & Associates in Trouble with FINRA for Sale of Apple REIT

Investors who have suffered losses due to Apple REIT investments will be interested to learn that FINRA filed a complaint against David Lerner & Associates, Inc. (DLA) this week for the sale and recommendation of Apple REIT Ten.

FINRA claims: "DLA has sold and continues to sell Apple REIT Ten targeting unsophisticated and elderly customers with unsuitable sales of the illiquid security."

The complaint charges DLA with failure to investigate the suitability of the $2 billion Real Estate Investment Trust before recommending and selling the product to investors. The complaint also alleges that DLA provided misleading information on its website about the product. Additional allegations include artificial inflation of Apple REITS since at least 2004, and omissions of material information.

According to the news release, FINRA alleges that over the past five months alone, DLA (which receives 10 percent of all offerings plus fees) has sold over $300 million shares of Apple REIT Ten. Sales of Apple REIT have made up 60 to 70 percent of DLA's annual business since 1996, and have generated approximately $600 million in revenue for the firm.

Investors who purchased shares of Apple REIT Ten from David Lerner & Associates may be able to recover losses through a FINRA arbitration claim. FINRA's complaint alleges fraud and misrepresentation on the part of DLA. Investors may be able to file an arbitration claim alleging the same.

To learn more about the complaint, read FINRA's release here.

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