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Investors of SCI Real Estate Investment TICs Could Recover Losses
Investment fraud lawyers are currently investigating claims on behalf of investors who suffered losses as a result of their purchases of SCI Real Estate Investments LLC’s TICs. In some cases, brokerage firms may be held liable for their recommendation of the investment to their clients.
According to securities fraud attorneys, TICs became popular in 2002, following a ruling by the Internal Revenue Service that allowed capital gains to be deferred by investors. In this property ownership, a fractional interest is owned by two or more parties. However, following the real estate crisis, TICs saw a significant decline in value. For more information on TICs, see the previous blog post, “TICs Dangerous for Many Investors.”
SCI Real Estate Investments is a United States real estate company that acquires retail and multi-family properties. It offers co-ownership interests in these United States properties as investments to individual buyers of real estate and 1031 exchanges. SCI is based in Los Angeles and was founded in 1994. A voluntary petition for reorganization was filed by SCI on February 11, 2011, under Chapter 11 in the U.S. Bankruptcy Court for the Central District of California. The firm’s liquidation plan confirmation hearing is scheduled for June 13, 2012.
Investment fraud lawyers say one especially problematic SCI offering is the SCI Capital Group Mezzanine Fund. This fund invested in unsecured loans to SCI and SCI affiliates, and did not invest in real estate. It is likely that these loans will be discharged by the bankruptcy filing. In addition to the Mezzanine Fund, other TICs offered by SCI have been negatively affected by the collapse of the real estate market.
If you suffered losses as a result of your investment in TICs or other real estate offerings with SIC Real Estate Investments, you may have a valid FINRA securities arbitration claim. To find out more about your legal rights and options, contact a securities fraud attorney at The Law Office of Christopher J. Gray at (866) 966-9598 for a no-cost, confidential consultation.