{"id":1532,"date":"2014-10-18T20:39:53","date_gmt":"2014-10-18T20:39:53","guid":{"rendered":"https:\/\/www.stockbrokerfraudblog.com\/2014\/10\/sec_approves_regulations_invol"},"modified":"2022-03-11T13:33:35","modified_gmt":"2022-03-11T19:33:35","slug":"sec-approves-regulations-invol","status":"publish","type":"post","link":"https:\/\/www.investorlawyers.com\/blog\/sec-approves-regulations-invol\/","title":{"rendered":"SEC Approves Regulations Involving REIT Prices and Arbitration Fraud Intervention"},"content":{"rendered":"

\t\t\t\tThe U.S. Securities and Exchange Commission has approved a Financial Industry Regulatory Authority-proposed rule that would create greater transparency of Nontraded real estate investment trusts. Under the new rule, investors will have to be provided with more information about the costs involved in buying shares of nontraded REITs.<\/p>\n

With the existing practice, brokerage firms can list nontraded REITS as having $10\/share price. The new rule would obligate broker broker-dealers to include a per share estimated value for an REIT or unlisted direct participation program on customer statements and make other disclosures.<\/p>\n

Firms would calculate an REIT or DPP per share estimated value by either using the appraised value methodology or the net investment methodology. The appraised value method involves using the liabilities and assets of the REIT or DPP to determine the valuation upon which the share value would be based. The valuations would have to be conducted at least once a year by a third-party valuation expert. The net investment method involves brokerage firms articulating in customer statements that a portion of return of capital is included in a distribution and that this return lowers the estimated per share value listed on the statement. <\/p>\n

Continue Reading \u203a<\/a><\/div>\n","protected":false},"excerpt":{"rendered":"

The U.S. Securities and Exchange Commission has approved a Financial Industry Regulatory Authority-proposed rule that would create greater transparency of Nontraded real estate investment trusts. Under the new rule, investors will have to be provided with more information about the costs involved in buying shares of nontraded REITs. With the existing practice, brokerage firms can […]<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"footnotes":""},"categories":[3798,3759,3760],"tags":[],"class_list":["post-1532","post","type-post","status-publish","format-standard","hentry","category-arbitration","category-reits","category-sec-enforcement"],"yoast_head":"\nSEC Approves Regulations Involving REIT Prices and Arbitration Fraud Intervention — Investor Lawyers Blog — October 18, 2014<\/title>\n<meta name=\"description\" content=\"The U.S. Securities and Exchange Commission has approved a Financial Industry Regulatory Authority-proposed rule that would create greater transparency of — October 18, 2014\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" 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