The White Law Group Files FINRA Claim Against Cambridge Investment Research Over Private Placement Losses
The White Law Group has filed a FINRA arbitration claim on behalf of a South Carolina family against Dempsey, Lord Smith, which the claim alleges is now operating under FINRA member firm Cambridge Investment Research. The claim alleges the family’s broker recommended a series of unsuitable private placement investments. The family is seeking damages of $500,000 to $1,000,000. If you invested through this broker or branch and suffered losses, you may be able to speak with our FINRA arbitration attorneys about your options.
What the Claim Alleges
The claim alleges the broker recommended a concentrated series of illiquid private placements to the claimants without adequately considering their risk tolerance, investment objectives, need for liquidity, or overall portfolio concentration. The claimants allege that Dempsey Lord Smith, as the FINRA member firm responsible for supervising the broker’s recommendations, failed to catch and stop a pattern of unsuitable sales.
Investments Named in the Claim
The claim identifies the following private placements as having been recommended to the claimants:
- DeMarcay Development Preferred Partners, LLC
- Vibrant Minerals Investments, LLC
- Tarpon Creek Investments, LLC
- Harmon South Investments, LLC
- Fishpond Investments, LLC
- Basin Mountain Investments, LLC
- Blue Ridge Valley Investments, LLC
- Harlan Mountain Investments, LLC
- GPB Cold Storage, LP
- GPB New York City Development, LP
- North By Northwest II, LLC
- North By Northwest III, LLC
- North By Northwest IV, LLC
Several of the LLC-named investments above are structured as conservation easement syndications.
The claim alleges a conflict of interest tied to most of these conservation easement offerings: they were reportedly managed and prepared by a firm called Webb Creek Management Group, which the claim alleges included several individuals also registered as representatives of the broker’s firm.
Managing Partner Statement
“We believe there may be other investors who were sold the same or similar private placements through this broker and don’t yet realize they have recourse,” said Dax White, managing partner of The White Law Group. “A concentrated portfolio of illiquid private placements is rarely suitable for retail investors, and firms have a duty to supervise what their brokers are recommending.” You can learn more here about our recently filed claims.
Can Cambridge Investment Research Be Held Responsible?
Broker-dealers are required to supervise the recommendations made by their registered representatives. When a firm fails to catch unsuitable or overconcentrated recommendations, it can be held liable for the resulting losses, even if it did not directly make the recommendation itself.
Recovering Losses from Private Placement Investments
Investors who were sold unsuitable, high-risk, or illiquid private placements may be able to recover losses through FINRA arbitration. The White Law Group is investigating potential claims on behalf of other investors who worked with this broker or branch and were recommended similar investments.
Contact The White Law Group
The White Law Group is a national securities fraud and investor protection law firm with offices in Chicago and Seattle. If you invested through Dempsey, Lord Smith or Cambridge Investment Research and believe you were sold unsuitable private placements, call us today at (888) 637-5510 for a free consultation, or contact us online.
Frequently Asked Questions
1. How do I file a claim to recover money I invested through this broker?
Most brokerage account agreements typically include a pre-dispute arbitration clause, which many investors don’t know exists until they need it. That means claims like this are generally filed and resolved through FINRA arbitration rather than in court, and arbitration can still result in a monetary recovery for investors.
2. What makes a private placement recommendation “unsuitable”?
A recommendation is unsuitable when it doesn’t match an investor’s risk tolerance, liquidity needs, or investment goals. Private placements like conservation easement syndications are illiquid, high-risk, and generally inappropriate for a large share of a retail investor’s portfolio.
3. Can Cambridge Investment Research be held responsible even if it didn’t directly approve the investment?
Yes. Broker-dealers have a duty to supervise their registered representatives’ recommendations. If a firm’s supervisory system failed to catch a pattern of unsuitable sales, the firm may be liable for the resulting losses.
