The law firm of Oakes & Fosher is presently investigating the alleged misconduct of former securities broker Shawn Davis. According to his publicly available FINRA BrokerCheck report, Shawn Davis has been the subject of multiple customer disputes.

Shawn Davis was a California based securities broker. He worked in the securities industry for nineteen years. During his career, he was registered with six different securities firms. He is no longer working as a registered securities broker in any fashion.

His Registrations

  • NYLIFE Securities (1998-2004)
  • QA3 Financial Corp. (2004-2005)
  • Royal Alliance Associates (2005)
  • Berthel Fisher & Company (2005-2012)
  • WFG Investments (2012-2014)
  • Independent Financial Group (2014-2017)

The Allegations

  • In September 2013, a customer alleged that investments purchased by Shawn Davis on their behalf were unsuitable and misrepresented. This case was settled for $52,000 in damages.
  • In March 2016, a customer alleged that Shawn Davis did not fully inform them of the risks associated with REIT offerings purchased from 2013 to 2016. This case is currently pending. The customer is seeking an undisclosed amount in damages.
  • In September 2017, a customer alleged that Shawn Davis managed their account negligently, made material misrepresentations, made material omissions, breached his fiduciary duty, violated California Corporation Code, and churned their account. These allegations were regarding alleged REIT investments. This case was settled for $18,000 in damages.
  • In March 2018, customers alleged that the investments they purchased between 2005 and 2006 on Shawn Davis’ recommendations were unsuitable and misrepresented. This case is currently pending. The customers are seeking $1.5 million in damages.
  • In April 2018, customers alleged that Shawn Davis recommended unsuitable investments and made material misrepresentations about said investments. This case is currently pending. The customers are seeking $500,000 in damages.
  • In July 2018, a customer alleged that Shawn Davis recommended unsuitable investments. This case is currently pending. The customer is seeking $560,000 in damages.
  • In October 2019, customers alleged that Shawn Davis recommended highly unsuitable REIT and other DPP investments. This case is currently pending. The customers are seeking $800,000 in damages.
  • In January 2020, customers alleged Shawn Davis recommended unsuitable investments that he made material misrepresentations about. This case was settled for $7,000 in damages.

What Does This Mean?

Non-traded real estate investment trusts, or REITs, are a type of alternative investment. Like all alternative investments, non-traded REITs do not trade on any public securities exchanges. Rather, these products are recommended directly to investors by their securities brokers. Due to their private nature, non-traded REITs are very poorly regulated. This provides many securities brokers ample opportunity to misrepresent them as safe and consistently lucrative–when nothing could actually be further from the truth. In actuality, non-traded REITs are incredibly speculative, highly illiquid, have extremely inconsistent distributions, and are accompanied by highly unnecessary fees that drastically drain investor principal investments. Despite how unsuitable these products can be, less than scrupulous securities brokers consistently recommend them to investors because of the incredibly large commissions they receive when doing so. Broker commissions for these products can be as high as 10 percent of an investor’s principal. This commission compounded with other upfront fees can drain an investor’s principal of as much as 17 percent. This makes it near impossible for them to see any investment returns under anything besides a booming market.

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 Shawn Davis, 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.