The law firm of Oakes & Fosher is presently investigating the alleged misconduct of securities broker Robert Ginsberg. According to his publicly available FINRA BrokerCheck report, Robert Ginsberg has been the subject of multiple customer disputes connected to his alleged recommendations of non-traded REITs.
Robert Ginsberg is a Connecticut based securities broker. He has worked in the securities industry for twelve years. During his career, he has been registered with two different securities firms.
His Registrations
- Investors Capital Corp. (2008-2016)
- Woodbury Financial Services (2016-Present)
The Allegations
- In November 2017, a customer alleged that Robert Ginsberg recommended highly unsuitable alternative investments known as non-traded REITs. This case is currently pending. The customer is seeking $1 million in damages.
- In December 2017, a customer alleged that Robert Ginsberg recommended unsuitable investments. This case is currently pending. The customer is seeking an undisclosed amount in damages.
- In April 2019, a customer alleged that Robert Ginsberg recommended highly unsuitable alternative investments like non-traded REITs and non-traded BDCs. This case is currently pending. The customer is seeking $500,000 in damages.
Non-Traded REITs
Non-traded REITs, also known as real estate investment trusts, are privately traded investment funds not sold on any public securities exchanges. Rather, these securities are recommended directly to investors by securities brokers. They are investment pools designed to make income through the purchase of real estate. Non-traded REITs are very poorly regulated and are accompanied by a significant lack of oversight. Some less than scrupulous securities will use this to their advantage and misrepresent non-traded REITs as low-risk and consistently lucrative investments when nothing could actually be further from the truth. The truth about non-traded REITs is that they are typically very speculative and very illiquid due to the nature of the investment. Once an investor purchases a non-traded REIT, they may be stuck in this investment for years. Even if an emergency arises, and they need to withdraw their funds, non-traded REITs may be very difficult to liquidate. Sponsors of these products may only offer redemptions for a very small percentage of the outstanding shares on a quarterly or yearly basis–if at all. Some non-traded REITs can be sold on a secondary market, however, at a price that is typically much lower than the value stated by the non-traded REIT sponsor, and done with significant costs. On top of this, non-traded REIT pricing can be very misleading as the value of most of these products is very difficult to determine, and the sponsor will usually set a price that overstates the market value of the security. Despite how unsuitable these investments can be, less than scrupulous securities brokers continue to push them onto unsuspecting investors due to the incredibly high commissions they receive when the transactions are executed. The broker’s commission can be as high as ten percent of the investor’s principal investment. This is compounded with other upfront fees, which, in total, can drain an investor’s principal of up to 17 percent. When an investor’s principal is lowered that significantly, the chances of them actually seeing any returns on their investment lowers drastically. Essentially, non-traded REITs are unsuitable for most investors and only exist to service brokers and those operating them.
Oakes & Fosher Can Help
Many investors are unaware of the legal recourse available to them after losing money due to securities broker fraud and/or negligence. The truth is that investors who have lost money in this fashion may actually be entitled to damages.
Oakes & Fosher dedicates its entire legal practice to helping investors across the nation. If you, or someone you know, have lost money investing with Robert Ginsberg, please contact Oakes & Fosher for a free and private consultation. Oakes & Fosher handles cases on a contingency basis, which means there are no fees charged unless we collect for you.
