Written by The White Law Group• December 29, 2022• 6:35 am• Blog, Current Investigations

Four Springs Capital Trust Withdraws Registration Statement

Four Springs Capital Trust Withdraws Registration Statement due to Market Conditions

The White Law Group continues to investigate potential securities claims involving Four Springs Capital Trust. Four Springs Capital Trust, an internally managed REIT, is reportedly focused on single-tenant, income producing industrial, medical, service/necessity retail and office properties throughout the United States that are subject to long-term net leases.

According to reports this week by the DI wire, the REIT filed a request with the Securities and Exchange Commission (SEC) to withdraw its registration statement on a previously filed Form S-11. Four Springs has reportedly decided not to pursue the sale of the securities at this time “due to market conditions.”

This comes after the REIT made an Initial Public Offering (IPO) in January 2022 which it postponed, also “due to market conditions.”

This is not the first time the company has attempted and failed to launch an IPO. We reported in 2017, Four Springs Capital Trust canceled a $115.9 million initial public offering due to “unfavorable market conditions,” according to a filing with the Securities and Exchange Commission.

The Risks of Alternative Investments

The trouble with alternative investment products, like Four Springs Capital Trust, is that they involve a high degree of risk and are typically sold as unregistered securities which lack the same regulatory oversight as more traditional investment products like stocks or bonds.

The White Law Group is investigating the liability that brokerage firms may have for improperly selling alternative investments like Four Springs Capital Trust.

Broker dealers that sell alternative investments are required to perform adequate due diligence on all investment recommendations. They must ensure that each investment recommendation that is made is suitable for the investor in light of the investor’s age, risk tolerance, net worth, financial needs, and investment experience.

However, another problem with this type of investment is the high sales commissions and due diligence fees the brokers earn. Brokers have an enormous incentive to push the product to unsuspecting investors who do not fully understand the risks of these types of investments. They can easily misrepresent the basic features of the products – usually focusing on the income potential and tax benefits while downplaying the risks.

Fortunately, FINRA provides an arbitration forum for investors to resolve such disputes. If a broker or brokerage firm makes an unsuitable investment recommendation or fails to adequately disclose the risks associated with an investment, they may be found liable for investment losses in a FINRA arbitration claim.

Recovery Options for Investors

To determine whether you may be able to recover investment losses incurred as a result of your purchase of Four Springs Capital Trust, please contact The White Law Group at 1-888-637-5510 for a free consultation.

The White Law Group, LLC is a national securities fraud, securities arbitration, investor protection, and securities regulation/compliance law firm with offices in Chicago, Illinois and Seattle, Washington. The firm represents investors throughout the country in claims against their brokerage firm.

For more information on the firm and its representation of investors, visit www.WhiteSecuritiesLaw.com.