Greenbird Capital Sanctioned for Supervisory Failures Related to Private Placements and Telemarketing
The White Law Group is investigating potential claims involving Greenbird Capital and its sale of high-risk private placement investments.
On July 24, 2025, the Financial Industry Regulatory Authority (FINRA) reportedly issued a disciplinary action against Greenbird Capital LLC, citing supervisory failures related to the firm’s solicitation of private placement offerings and telemarketing practices. According to FINRA’s Letter of Acceptance, Waiver and Consent (AWC), Greenbird Capital was censured and fined $50,000 for violations of FINRA Rules 3110, 3230(d), and 2010.
FINRA Findings: Greenbird Capital Solicited Millions Without Adequate Oversight
Between May 2021 and December 2023, Greenbird Capital reportedly sold interests in 14 private placements, raising approximately $24 million from investors. These offerings were conducted under Rule 506(b) of Regulation D, which prohibits general solicitation unless the issuer has a pre-existing, substantive relationship with each investor.
However, FINRA found that Greenbird Capital failed to establish or enforce any supervisory system, including written procedures, designed to identify or prevent general solicitation of these offerings. The firm also lacked policies addressing:
- What constitutes a “pre-existing, substantive relationship”
- How to document when a substantive relationship had been established
- How to ensure that solicitations occurred only after such relationships were confirmed
During this period, Greenbird’s registered representatives reportedly made hundreds of thousands of cold calls to prospective investors without a reasonable system to verify whether a pre-existing relationship existed. As a result, Greenbird potentially violated the very rules it relied upon to claim exemption from federal registration requirements.
Additionally, the firm allegedly violated telemarketing rules by failing to supervise calls in accordance with the National Do-Not-Call (DNC) list and by permitting calls during prohibited hours.
Understanding the Risks of Private Placements
Private placements are non-public securities offerings that are often marketed as exclusive investment opportunities. While these investments may provide high returns, they typically carry significant risks, including:
- Illiquidity – Private placements are not traded on public markets and are often difficult to sell.
- Lack of transparency – Issuers may provide limited financial disclosures.
- High commissions – Brokers may earn excessive fees, incentivizing unsuitable recommendations.
- Complex structures – Investors may not fully understand what they’re buying.
Because private placements are generally offered to accredited investors, they are not subject to the same investor protections as publicly registered securities.
The Importance of Broker Due Diligence and Supervision
FINRA Rule 3110 requires brokerage firms to establish and maintain a supervisory system designed to ensure compliance with securities laws. This includes:
- Conducting due diligence on investment products
- Monitoring broker conduct
- Ensuring that investments are suitable for each client
In this case, FINRA found that Greenbird Capital’s lack of oversight created a significant risk that investors were being improperly solicited, potentially for unsuitable or unvetted investments.
When brokerage firms fail in their supervisory duties, investors are often the ones who pay the price.
FINRA Arbitration for Investors with Losses
If you invested in a private placement through Greenbird Capital and suffered financial losses, you may have grounds to file a claim through FINRA arbitration.
The White Law Group has represented hundreds of investors in FINRA arbitration claims involving private placements, general solicitation violations, and failure to supervise. We may be able to help you recover your investment losses.
FINRA arbitration is a forum specifically designed to resolve disputes between investors and brokerage firms. Potential claims may include:
- Misrepresentation or omission of material facts
- Unsuitable investment recommendations
- Lack of due diligence
- Failure to supervise brokers
Time is limited to file these claims, so investors are encouraged to seek legal advice as soon as possible.
Free Consultation
If you have concerns about your investments with Greenbird Capital or believe you were improperly solicited for a private placement offering, please call The White Law Group at 1-888-637-5510 for a free consultation.
For more information, please visit www.whitesecuritieslaw.com.
Frequently Asked Questions (FAQs) : Greenbird Capital
What is a general solicitation in a private placement offering?
A general solicitation includes advertising or publicly marketing a private investment opportunity, which is generally not permitted under Rule 506(b) unless there is a pre-existing, substantive relationship with the investor.
Can I recover losses from a private placement investment?
Yes. If a brokerage firm failed to conduct due diligence or supervise its representatives, and you suffered losses as a result, you may be able to file a FINRA arbitration claim to pursue recovery.
What should I do if I received cold calls from a broker about private investments?
If you were cold-called and offered private placements without a prior relationship or understanding of the investment, this could violate securities laws. Contact a securities attorney to discuss your rights and options.
Last modified: August 5, 2025
