Illinois Investor Files FINRA Claim Against Great Point Capital Over Unsuitable DST Investments
The White Law Group has filed a FINRA arbitration claim against Great Point Capital on behalf of a self-employed business owner from Illinois. According to the Statement of Claim, the investor’s broker allegedly recommended a string of unsuitable investments, most of them Delaware Statutory Trust (DST) offerings. The claimant is seeking damages of more than $5,000,000. Investors who bought DST investments through Great Point Capital and lost money can talk to our FINRA arbitration attorneys about their options.
What the Claim Alleges Against Great Point Capital
The claim alleges the broker steered a retirement-age investor into one illiquid real estate offering after another without properly weighing the investor’s age, income needs, risk tolerance, or need to reach their money. It also alleges that Great Point Capital, as the FINRA member firm responsible for supervising the broker, failed to stop the pattern of recommendations.
DST Investments Named in the Claim
The claim identifies the following investments as having been recommended to the claimant:
- CAI Manufacturing Essential Asset DST
- CAI Investments Healthcare Products I DST
- NexPoint Storage II DST
- NexPoint Life Sciences DST
- Inland Private Capital Corp – VA Coastal Logistics
- Great Lakes Funds Solutions – Trilogy
- Government Lease Holdings DST
- Cunat Exchange DST
- NexPoint Semiconductor DST
- LRT Hardeeville Senior DST
- Montego Minerals Coyote Plains Properties, LLC
- LRT Hardeeville Multifamily I DST
Most of these are DSTs, though not every investment on the list is one. DSTs are private placements, usually sold to accredited investors who are completing 1031 exchanges. Investors typically cannot sell their interests on a market and have no say in how the property is run. Holding a large number of them can leave an investor with very little money they can reach.
Managing Partner Statement
“Investors need to be able to count on their savings, and that matters even more for someone at or near retirement age,” said Dax White, managing partner of The White Law Group. “Putting that much money into a dozen illiquid DST offerings is hard to square with the suitability rules. We believe there may be other investors who were sold similar investments and don’t realize they have recourse.”
Can Great Point Capital Be Held Responsible?
Brokerage firms must supervise the recommendations their registered representatives make. If a firm fails to catch unsuitable or overconcentrated sales, it may be liable for the losses that follow, even if a broker made the recommendation.
Recovering Losses From DST Investments
Investors who were sold unsuitable DST investments may be able to recover losses through FINRA arbitration. The White Law Group is looking into potential claims for other investors who worked with this broker or firm and were recommended similar offerings.
Contact The White Law Group
The White Law Group is a team of national securities fraud attorneys with offices in Chicago and Seattle. If you invested in DSTs through Great Point Capital and have losses, call (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 Great Point Capital?
Most brokerage account agreements typically include a pre-dispute arbitration clause, so claims like this usually go through FINRA arbitration instead of court. Many investors don’t know that clause exists, and arbitration can still lead to a monetary recovery.
2. Why can DST investments be risky for someone near retirement?
DSTs are illiquid, so an investor may not be able to sell or cash out when they need money. Many also depend on a single property or a small group of properties, and owning several of them can pile up the same risk.
3. Can Great Point Capital be held responsible for my losses even if it didn’t approve the investment?
Yes, a firm may be liable for failing to supervise its brokers. Firms have a duty to review what their representatives recommend, and a lapse in that review can create liability.
