Retiree Is Seeking Up to $1,000,000 For What She Alleges Was An Unsuitable Investment Recommendation

An older investor from Oceanside, California, is seeking up to $1 million in a FINRA arbitration claim against Emerson Equity for allegedly recommending unsuitable investments in an Inspired Healthcare Capital Delaware Statutory Trust that recently filed for bankruptcy. Represented by the law firm Shepherd Smith Edwards and Kantas, the retiree accuses the broker-dealer of negligence, excessive concentration, and failing to disclose high fees and conflicts of interest.

Once again, an older investor is suing Emerson Equity over losses she suffered in an Inspired Healthcare Capital (IHC) Delaware Statutory Trust (DST). This is someone who entrusted a significant amount of her retirement money with this broker-dealer and its financial advisors. IHC, which is an assisted living developer, filed for Chapter 11 Bankruptcy protection earlier this year. Now, she is pursuing up to $1,000,00 in financial recovery.

Shepherd Smith Edwards and Kantas (investorlawyers.com) is representing this Claimant in Financial Industry Regulatory Authority (FINRA) arbitration against Emerson Equity. We are also representing many other investors against this broker-dealer.

This investor contends that her money was overconcentrated in the DST called Inspired Healthcare Capital Trust Naperville. Not only was Emerson Equity the underwriter, but also it was the managing brokerage firm for all IHC Funds and DSTs. This was a clear conflict of interest.

Delaware Statutory Trusts are Regulation D offerings and private placements. They should only be sold to accredited, experienced investors. They should not be marketed or recommended to retail investors, including conservative retirees.

This investor worked with Emerson Equity broker John Paul Ledesma. Last year, at least three of his other customers filed investor lawsuits alleging improper advice and due diligence failures.

In her Inspired Healthcare Capital loss case, our Client is alleging excessive concentration, unsuitability, Regulation Best Interest violations, supervisory failures, misrepresentations and omissions, negligence, gross negligence, breach of contract, breach of fiduciary duty, vicarious liability, and more.

How Much Did Emerson Equity and Its Brokers Earn From Selling IHC Funds and DSTs to Customers? 

Our Client sustained serious losses. Meantime, this broker-dealer and its financial advisors earned a multi-layer of fees that customers are saying were never fully explained to them. Our Inspired Healthcare Capital fraud lawyers have since discovered that these fees included:

6% commission

1% dealer management fee

1% broker-dealer allowance

1.5% wholesaling fee

3% marketing cost 

12.5% in commission and other fees total.

This meant that off the top, Emerson Equity stood to earn in the mid-five-figures on our Client’s money.

Why Are Inspired Healthcare Capital Investors Suing Emerson Equity For Financial Recovery? 

In the wake of the bankruptcy, and also previous to that, the suspension of redemptions and returns, investors are pursuing damages from their brokers for the following:

• Making unsuitable investment recommendations
• Not fully disclosing the risks or commission fees
• Excessively concentrating on their account
• Failing to disclose certain conflicts of interest
• Due diligence failures
• Breach of fiduciary duty
• Breach of Contract
• Violations of Regulation Best Interest
• And more.

Financial advisors had a duty to make sure recommending IHC was only done when it was in line with a customer’s financial goals and risk tolerance level. Many of the Inspired Healthcare Capital investors that Shepherd Smith Edwards and Kantas is representing are retail investors and retirees who did not need to become involved in DSTs or other private placements. While you may be able to get a little back from the bankruptcy case, there is a chance of getting back more, even all, of your money by suing your broker for misconduct or negligence.

How Can You Find Out If You Should Sue Your Broker Over Your Inspired Healthcare Capital Losses?

Call (800) 259-9010 or fill out this online form today so we can help you assess whether you have grounds for a claim. Our IHC recovery attorneys are skilled when it comes to fighting for investors against their brokers and protecting their legal rights. Over the years, we have secured a collective many millions of dollars in awards and settlements for thousands of investors.