Triad Advisors Sued Over GPB Private Placement Sales
In our latest GPB investor fraud claim against a brokerage firm, Shepherd Smith Edwards and Kantas, (SSEK Law Firm) is seeking up to $500K from Triad Advisors on behalf of a retired Texas couple. The claimants, who are in their seventies, entrusted a significant chunk of their savings to Triad brokers Jack Jones and Mark Robare, whom they are accusing of overconcentrating their money in GPB private placements and other unsuitable investments. The couple contend that they lost half a million dollars as a result.
GPB Capital Holdings, an alternative asset firm that issued the private placements, is accused of operating a $1.5B Ponzi scam. Now, the 60 brokerage firms whose registered financial representatives sold these investments are finding themselves the subject of broker fraud claims from investors seeking to recover their money.
Already, SSEK Law Firm has filed complaints for many of these investors against Triad Advisors, Ameriprise, Arkadios Capital, Kalos Capital, Pruco Securities, International Assets Advisory, and other firms. Contact our GPB investor fraud lawyers today.
Potential Damages From GPB Litigation Could Be Over $2M, Says Triad
It was just earlier this month Triad Advisors filed a financial statement with the US Securities and Exchange Commission (SEC) noting that the broker-dealer is now the subject of at least nine investor fraud lawsuits accusing it of negligence for allowing its brokers to sell GPB Capital Holdings private placements. Potential damages from this litigation could likely exceed $2M, said the firm.
Considering that in November, its former parent company Ladenburg Thalmann Financial Services said that there were six GPB cases against Triad, the number of complaints are growing. In February, Advisor Group acquired Ladenburg Thalman and its independent brokerage firm subsidiaries Triad, Securities America, Securities Network, KMS Financial Services, and Investacorp.
Over-concentration, Unsuitable Investments in GPB
In this latest GPB investor fraud case against Triad Advisors, the claimants contend that the broker-dealer and its two brokers promised to employ an investment plan that came with low risks. They also said they would structure the couple’s accounts so there would be income and a return on principal.
Instead, our clients who are inexperienced investors, contend that Triad, Jones, and Robare used a strategy that was “overly aggressive” and overconcentrated in private placements, including placing $100K of their money in the GPB Holdings Fund. The firm also invested the couple in NorthStar Healthcare, a privately traded real estate investment trust (REIT) that no longer is paying dividends and looks to be in trouble as well.
The claimants, in their GPB fraud lawsuit, are making a number of allegations, including:
- Unsuitable investment recommendations
- Due diligence failures
- Gross lack of supervision
- Improper asset allocation
- Breach of fiduciary duty
A substantial portion of the couple’s savings was in IRAs. SSEK Law Firm believes that there was no reason for these funds to be placed in investments that were privately traded, especially considering that anything taken out of an IRA gets taxed.
With 32 years in the industry, Triad Advisors broker Mark Robare has been with the firm for 17 years. Previous to that he was a Veravest Investments broker.
As for Triad Advisors broker Jack Jones, who has been in the industry for 25 years, this is the second GPB investor fraud case naming him. According to his BrokerCheck record, another customer is also seeking $500K in damages. Jones was once a Veravest broker, too.
GPB Private Placements Investigation
By their nature, private placements are illiquid and high-risk. They also charge high commissions, which is a likely incentive for many of the brokers who sold GPB investments, seeing as brokerage firms have earned over $160M from the sales.
Just as GPB investments are generally unsuitable for inexperienced investors who can’t take on too much risk, they are equally if not more unsuitable for retired investors who often no longer have the opportunity to make additional income in the event of significant losses.
GPB Capital Holdings remains under investigation by the Federal Bureau of Investigation (FBI), the SEC, the Financial Industry Regulatory Authority (FINRA), and others.