Broker Negligence Attorney

GK 7% Bond Investment Losses

Did Your Broker Unsuitably Recommend These Unsecured GK Investment Holdings Bond?

Three years after GK 7% bondholders were asked to trade in their older bonds for newer ones, Shepherd Smith Edwards and Kantas Broker Negligence Attorney team (investorlawyers.com) is investigating claims of  unsuitability and misrepresentations and omissions against broker-dealers.

These unsecured bonds, issued by GK Investment Holdings, promised investors a 7% interest rate. They were told they could look to generate income from these bonds. Instead, bondholders ended up being told that if most of them didn’t trade in their bonds, a default could occur, repayments might be delayed or never come, and the alternative asset firm could go bankrupt.

A filing with the US Securities and Exchange Commission (SEC) by GK Investment Holdings last year noted that around 80% of GK 7% bond investors did, in fact, trade their older bonds. However, serious investment losses may have taken place.

Were Seniors and Conservative Retail Investors Not Fully Apprised of the GK 7% Bonds Risks?

These unsecured bonds from GK Investment Holdings were backed by speculative real estate, which means they were a risky proposition from the start.

There may be investors who were not given an accurate representation of this fact, which would be considered misrepresentation and omission that could be grounds for an investment loss recovery claim against their financial advisor.

Also, most inexperienced investors and conservative retirees likely should never have been marketed and sold any GK 7% bonds.

While JCC Advisors was the managing broker-dealer of these GK Investment Holdings debt instruments, other brokerage firms also may have promoted them to customers. Unsuitability is one of the most common kinds of broker misconduct that can lead investors to lose money on an investment.

Broker-dealers have a duty to conduct the proper due diligence not only into any investment they recommend to customers but also, it is their job to look at an investor’s profile to ensure suitability according to their portfolio, age, risk tolerance level, liquidity needs, financial goals, and more.

Broker-dealers have a duty to properly monitor their financial advisors and the latter’s activities in customers’ accounts. They are supposed to identify red flags indicating when it might be time to reassess an investment recommendation or make key changes to a client’s asset allocations to protect them from investment losses that might otherwise have been avoided.

However, with non-traditional investments, financial advisors and their firms often have an opportunity to earn higher commissions than they would with less risky, more liquid investments. Because of this, there are stockbrokers who will disregard an investor’s best interests even if the end result could prove financially catastrophic.

What Should You Do If You Suspect Your GK 7% Bond Losses Involve Broker Negligence?

Contact us our Broker Negligence Attorney team at Shepherd Smith Edwards and Kantas to schedule your free, initial case consultation. We can help you assess the cause of your investment losses and whether they warrant pursuing damages from your financial advisor.

Even if their broker-dealer was not aware of their actions, you may be able to sue for financial recovery. Our GK 7% Bond recovery attorneys represent investors against US broker-dealers. More than 90% of our clients have received full or partial financial recovery.

Call our Broker Negligence Attorney team at (800) 259-9010.