California Investor Files FINRA Claim Against Cambridge Investment Research Over Non-Traded Real Estate Investment Losses
The White Law Group has filed a FINRA arbitration claim on behalf of a California woman in her sixties, a small business owner, against Cambridge Investment Research. The claim alleges her broker recommended unsuitable investments in InPoint Commercial Real Estate Income, Inc. and the Bluerock Private Real Estate Fund. The claimant is seeking damages of $100,000 to $500,000. If you invested through Cambridge Investment Research 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 position in illiquid, non-traded real estate investments without adequately considering the claimant’s risk tolerance, liquidity needs, or investment objectives. The claimant alleges that Cambridge Investment Research, 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 investments as having been recommended to the claimant:
- InPoint Commercial Real Estate Income, Inc., a non-traded real estate investment trust
- Bluerock Private Real Estate Fund, a registered closed-end interval fund
Both are illiquid, non-traded alternative investments that are difficult to value and generally carry higher fees than publicly traded real estate securities.
Managing Partner Statement
“A small business owner nearing retirement needs investments she can actually access, not money tied up in illiquid, non-traded real estate vehicles,” said Dax White, managing partner of The White Law Group. “We believe there may be other Cambridge Investment Research clients who were sold similar investments and don’t yet realize they have recourse.”
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 Non-Traded Real Estate Investments
Investors who were sold unsuitable non-traded REITs or interval funds 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 firm 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 Cambridge Investment Research and believe you were sold unsuitable non-traded real estate investments, 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 Cambridge Investment Research?
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 non-traded REIT or interval fund recommendation “unsuitable”?
A recommendation is unsuitable when it doesn’t match an investor’s risk tolerance, liquidity needs, or investment goals. Non-traded REITs and interval funds are illiquid and hard to value, making them generally inappropriate for a large share of a retail investor’s portfolio, especially for someone nearing retirement.
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.
