Easterly ROCMuni High Income Municipal Bond Fund (RMHIX) Investor Alert: Investigation Update
The White Law Group is investigating potential securities claims involving the Easterly ROCMuni High Income Municipal Bond Fund (Ticker: RMHIX) after the fund’s dramatic collapse in June 2025. Recent news reports indicate that investors in the fund have already filed lawsuits and complaints against Easterly Funds, and at least one arbitration claim has been filed against a financial advisor.
About the Easterly ROCMuni High Income Municipal Bond Fund
According to the fund’s materials, the Easterly ROCMuni High Income Municipal Bond Fund was marketed as a municipal bond fund investing primarily in tax-exempt securities. Traditionally, municipal bond funds are seen as conservative investments backed by state or local governments.
However, Easterly’s fund diverged sharply from those expectations. Instead of focusing on high-quality municipal bonds, RMHIX invested heavily in junk bonds or unrated municipal securities tied to speculative projects such as recycling plants, energy facilities, and senior-living developments. Many of these securities lacked the stability of traditional municipal debt and were far more vulnerable to default.
Collapse of RMHIX and Investor Losses
In June 2025, RMHIX experienced a stunning collapse, with investors losing more than 50% of their value in just two days. According to Bloomberg News, a third of the fund’s holdings were already in default at the time of liquidation, and more than 90% were unrated.
To meet redemption requests, Easterly reportedly sold dozens of illiquid and defaulted bonds for pennies on the dollar. For example:
- $9 million in defaulted securities tied to a Kentucky biodiesel facility were sold for just 3 cents.
- $7 million in bonds tied to a Texas dock project were sold for 6 cents — despite being valued at more than 70–90 cents only two weeks earlier.
By May 31, 2025, the fund’s yield of 6.7% was the highest of more than 60 high-yield muni funds, according to Morningstar. Analysts noted that such unusually high yields often signal outsized risk.
Lawsuits and Investor Complaints
Already, the Boston-based fund company has been hit with at least two shareholder lawsuits, alleging that Easterly:
- Inflated the value of certain fund assets.
- Misrepresented its exposure to illiquid and defaulted securities.
Separately, one investor has filed a FINRA arbitration claim against his financial advisor, alleging that the fund was marketed as a safe municipal bond investment without proper disclosure of its speculative risks.
If you purchased RMHIX through a broker or financial advisor, you may also have grounds to file a lawsuit or complaint for recovery of your losses.
Broker Duty and Potential Claims
Brokers and advisors have a duty to recommend investments that are suitable given their client’s financial situation, risk tolerance, and investment objectives. Recommending a high-risk fund like RMHIX to conservative or income-oriented investors may be considered unsuitable.
If your financial advisor misrepresented the nature of RMHIX or failed to disclose the risks of junk municipal bonds, you may be able to pursue damages through a FINRA arbitration claim.
How to Recover Losses in RMHIX
The White Law Group has successfully represented thousands of investors in FINRA arbitration claims against brokerage firms for:
- Unsuitable investment recommendations
- Misrepresentation or omission of risks
- Failure to conduct adequate due diligence
Through FINRA arbitration, investors may be able to recover losses without filing a class action or pursuing lengthy court litigation.
Free Consultation
If you suffered losses in the Easterly ROCMuni High Income Municipal Bond Fund (RMHIX), call The White Law Group at 888-637-5510 for a free consultation. Our attorneys can evaluate your potential claim and discuss recovery options.
Frequently Asked Questions
1. Why did RMHIX collapse in 2025?
RMHIX collapsed due to its heavy concentration in risky, unrated, and defaulted bonds. When investors began redeeming shares, the fund was forced to sell illiquid assets for pennies on the dollar, causing massive losses.
2. Are municipal bond funds usually this risky?
No. Traditional municipal bond funds invest in high-quality, government-backed debt. RMHIX was different because it invested primarily in speculative “junk” muni bonds tied to private-sector projects.
3. Can I file a lawsuit or complaint for RMHIX losses?
Yes. Investors may be able to file a FINRA arbitration claim against the brokerage firm or financial advisor that recommended RMHIX. Others may be eligible to participate in pending shareholder lawsuits against Easterly Funds.
4. How is FINRA arbitration different from a class action lawsuit?
FINRA arbitration is often faster and less costly than class actions. Instead of pursuing a broad class recovery, arbitration allows individual investors to seek compensation directly from their broker or advisor for unsuitable recommendations.
