Colombian Claimants Allege Negligence, Misrepresentations, and Failure to Supervise
Two investors from Bogota, Colombia are pursuing a Financial Industry Regulatory Authority (FINRA) arbitration claim against Truist Investment Services for the losses they suffered in Northstar Financial Services (Bermuda). The claimants, who are from the same family, had looked to the brokerage firm, which is affiliated with SunTrust Bank, to keep their assets safe.
As longtime SunTrust Bank clients with an account in Florida, the investors were not interested in taking on any undue risk and were mostly invested in bank products, including money markets. Yet, Truist Investment Services recommended that the claimants invest more than $125K in Northstar Financial Services (Bermuda).
That company is not solvent anymore, and the Bermuda government recently ordered it to undergo liquidation proceedings. At this point, it is unlikely that investors will recover their money without working with an experienced investor fraud law firm.
Our Northstar Financial Services (Bermuda) broker fraud attorneys at Shepherd Smith Edwards and Kantas (SSEK Law Firm at investorlawyers.com) are representing these South American investors in their FINRA arbitration fraud claim to recover damages. A panel of three arbitrators will hear this case in Miami, Florida.
Truist Investment Services Broker Overconcentrated Investors’ Account in Northstar Bermuda Products
Why did Truist recommend Northstar Financial Services (Bermuda) to these investors? This was an off-shore annuity that was too risky for these investors. Also, there were comparable US-based investment products that offered insurance and regulatory protections that could have been recommended instead.
The amount of $125K, which was the bulk of the claimants’ account, is considered exceedingly large for an offshore investment. This caused their brokerage account to be overconcentrated in Northstar (Bermuda) products. The high commissions and fees earned by Truist Investment Services and its broker were likely incentives for making this unsuitable investment recommendation.
Failure to Supervise Led to Subsequent Unsuitable Rollovers
The investors’ Truist Investment Services broker claimed they had carried out the proper due diligence into Northstar Financial Services (Bermuda) and its products. Yet even after Northstar (Bermuda) owner, Greg Lindberg was indicted on criminal charges —he would go on to be convicted of wire fraud and sentenced to several years in prison — the Truist broker re-recommended that these claimants roll back into their Northstar Financial product.
When the investors finally tried to get out of their investment last November, they were unable to leave. Now it appears that Lindberg likely misappropriated Northstar Financial Services (Bermuda)’s funds, funneling them to his other companies.
Truist Investment Services clearly failed to properly supervise its broker, who was likely self-supervised. Any reasonable supervisor would never have signed off on recommending this off-shore investment, or the subsequent rollovers, to these customers.
Claimants Are Vulnerable Adults Under Florida Law
Under Florida civil codes, these two claimants would be considered “vulnerable adults” because of their age. As part of their FINRA arbitration claim, they are seeking damages for the abuse, neglect, and exploitation of elderly and disabled persons.
SSEK Law Firm is pursuing FINRA arbitration claims against Truist Investment Services and the other broker-dealers that unsuitably sold Northstar Financial Services (Bermuda) investments to their customers. We represent investors in the US and those living abroad who purchased their products through a broker-dealer based in this country.
To schedule your free case consultation, in the US call (800) 259-9010. If you are in Florida, you can also call (813) 560-2992. Investors in Mexico can call our securities fraud lawyers at (800) 283-3403. Elsewhere in the world, you can message via WhatsApp (text only) at 713-227-2400.