Greenbacker Renewable Energy Recently Suspended Distributions
The Greenbacker Renewable Energy Fund recently suspended its distributions, and investors are not receiving the regular payments they were promised. This investment product was extremely speculative, with large hidden costs, and highly illiquid.
These investments are sometimes presented to investors as safe, non-correlated to the market, and low cost, but when in effect, the exact opposite is true. Since these products are non-traded, It is difficult to determine their true value.
Understanding Greenbacker Renewable Energy Funds
Greenbacker is a well-known player in the renewable energy investment industry. They offer various investment vehicles, including non-traded limited liability companies (LLCs) like the Greenbacker Renewable Energy Company (GREC) and Greenbacker Renewable Opportunity Zone Fund (GROZ). These private companies funds focus on the acquisition and management of renewable energy assets like solar and wind farms.
However, non-traded investments are risky, and brokerage firms often recommend them to unsuitable investors for their benefit.
The Drawbacks of Non-Traded Investments
Although Greenbacker positioned its Renewable Energy Funds as opportunities for investors to support the clean energy initiative, there are significant risks to consider.
- Liquidity Issues: Unlike publicly traded products like stocks or bonds, investors can’t buy or sell non-traded investments on an exchange. This lack of liquidity makes it challenging to leave the investment.
- Valuation Challenges: Non-traded investments rely on the issuer’s valuation rather than the market value. The statement price represents Greenbacker’s estimate of the product’s value at the time of the statement. However, it’s not typically accurate as to the true market value.
- High Fees & Expenses: Hefty upfront payments, continuous management fees, and hidden charges can significantly lower returns over time and lead to losses.
- Conflicts of Interest: private companies can often have conflicts of interest which cause them to engage in conduct which benefits the company or board members over the interests of the investors.
Broker Misrepresentation
FINRA regulations mandate brokers and brokerage firms to recommend investments that align with your risk tolerance level, investment goals, and financial condition. If your broker recommended investing in a Greenbacker Renewable Energy Fund without considering your portfolio or suitability, you may have legal grounds to recover your losses.
What Can Investors Do?
If you hold investments in the Greenbacker Renewable Energy Fund or similar non-traded products and have suffered significant losses, you should have options.
- Consult with a Securities Fraud Attorney: If you believe your broker misrepresented the investment or failed to adhere to the FINRA regulations, don’t hesitate to contact a securities fraud attorney. They can review your situation, assess your investment documents, and recommend the best course of action.
Seek Counsel from Oakes & Fosher
The Greenbacker Renewable Energy Fund suspension serves as a caution to investors considering non-traded investment products. If you or someone you know has lost money in a Greenbacker Renewable Energy Fund investment, please contact Oakes & Fosher. We handle these types of cases nationwide.
All cases are handled on a contingency fee basis, meaning if we don’t collect for you, there are no attorney’s fees. Please call now for a free consultation.
Frequently Asked Questions About the Greenbacker Renewable Energy Fund
Why were distributions of the Greenbacker Renewable Energy Fund suspended?
Greenbacker hasn’t publicly disclosed why it suspended its distributions, so investors are left without the regular payouts they were promised. However, non-traded investment products can face situations that impact distributions, such as valuation issues and unforeseen expenses.
Will Greenbacker resume distributions?
Greenbacker hasn’t provided a timeline for restarting regular distributions of the Renewable Energy Fund to investors. The fund’s future relies upon the organization’s ability to address the reasons for the suspension.
Are there potential tax implications from the suspension?
This situation may impact your taxes. Speak with a trusted tax professional to understand how the suspension might affect your tax filings. They can also advise you on reporting requirements and any tax benefits or implications.
How do I know if my broker misrepresented the Greenbacker Renewable Energy Fund?
FINRA requires brokers and firms only to recommend products that are suitable to you. If your broker didn’t explain the risks associated with non-traded investment products or the fund doesn’t align with your situation, you may have a legal claim. Contact the experienced securities fraud attorneys of Oakes & Fosher for a free consultation.
