Written by The White Law Group• March 17, 2023• 3:16 pm• Blog, Current Investigations

FS Energy & Power Fund (FSEP) Lawsuits Investigation

FSEP’s Redemption Program Remains Suspended

Invest in FS Energy & Power Fund (FSEP)? The White Law Group may be able to help you recover your investment losses. The White Law Group continues to investigate the liability that brokerage firms may have for unsuitably recommending FS Energy & Power Fund to investors.

FSEP (FS Energy & Power Fund) is a publicly registered, non-traded business development company sponsored by FS Investments. According to the company’s web page, market events in 2020 have impacted the financial markets and significantly disrupted U.S. and global economies, including energy markets.

The fund focuses primarily on investing in the debt and income-oriented equity securities of privately held U.S. companies in the energy and power industry. FSEP’s investment objectives are to “generate current income and long-term capital appreciation,” according to its website.

Dismal Net Asset Value (NAV)

Unfortunately for investors, FSEP’s NAV per share is currently $3.85 per share as of Sept 30, 2022. Shares were originally offered for $10.00 per share. According to the company, the purpose of these decreases is to ensure that the Company does not issue shares under the DRP at a price per share that was more than 2.5% greater than the NAV Per Share. The total cumulative return for the fund is –12.26% according to the company’s website.

According to Central Trade and Transfer, a secondary market for alternative investments, shares of FSEP were recently sold for just $2.50 per share, which may also indicate losses for investors.

FS Energy and Power Fund – Suspension of Redemptions

According to its website, FSEP’s share repurchase program remains suspended citing market events in 2020–2021 impacting “the financial markets and significantly disrupted U.S. and global economies, including energy markets.”

Potential Lawsuits to Recover Investment Losses

The White Law Group has represented numerous investors in claims against their brokerage firms to recover losses in alternative investments such as FSEP. For more information on the firm’s investigations, please see the following:

FSKR – FS Investments Lawsuits Update 2021

The trouble with business development companies like FSEP is that they involve a high degree of risk. They are typically sold as unregistered securities which lack the same regulatory oversight as more traditional investment products like stocks or bonds. Another issue is illiquidity – it may be difficult to find a buyer when you are ready to sell the investment, and when you do, it may be at a loss. 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 considering the investor’s age, risk tolerance, net worth, financial needs, and investment experience.

National Securities Attorneys

If you invested in FSEP with your financial advisor or broker, you may have recovery options by filing a FINRA Dispute Resolution Claim.

FINRA Dispute Resolution is an arbitration venue for investors with claims against their brokerage firm or financial professional. It provides investors with an opportunity to attempt to recoup their investment losses and is an alternative to filing such claims in court.

The White Law Group, LLC is a national securities fraud, securities arbitration, investor protection, and securities regulation/compliance law firm dedicated to helping investors in claims in all 50 states against their financial professional or brokerage firm. Since the firm launched in 2010, it has handled over 700 FINRA arbitration cases.

If you have suffered investment losses in FS Energy & Power Fund (FSEP), the White Law Group may be able to help you. Please call the offices at 888-637-5510 for a free consultation.

The White Law Group is a national securities fraud, securities arbitration, and investor protection law firm with offices in Chicago, Illinois and Seattle, Washington.

For more information on The White Law Group, and its representation of investors, please visit www.WhiteSecuritiesLaw.com.