Investor Lawyers Blog
VSR Financial Services, Inc. was recently part of a $3.74 million settlement in Texas state court because a former VSR advisor, Charles Chapman, allegedly recommended high risk, illiquid alternative investments during the credit crisis.
Chapman allegedly recommended that his client, Mr. Gordon McLendon, Jr. invest in Diversified Business Services & Investments Inc. (DBSI). However, DBSI declared bankruptcy in 2008 and it was eventually uncovered that it was a Ponzi scheme. As a consequence, Chapman’s client sued VSR alleging that they “failed to conduct proper due diligence associated with VSR before recommending and causing plaintiffs to make investments with VSR, including the DBSI investment.”
Other investments recommended by Chapman were:
• Icon Leasing Fund Eleven
• NetREIT 2006 Program
• Passco Real Estate Enterprises
• Cypress Income Fund VI
• CNL Income Properties
• Bradford XXV
• NetREIT 2008
• DBSI 2006 Notes
• Waveland Drilling Partners 2007
• ATEL Growth Capital Fund III
• Bradford Drilling Associates XXIII
• Cypress Equipment Fund 13
• LEAF Equipment Leasing Income Fund III
• Mewbourne EnergyPartners 07-A
Late this summer, the parties reached a settlement in the matter only weeks before it was scheduled to go to trial. VSR is responsible for $1.88 million, the insurance will cover $1.6 million, and Mr. Chapman will pay $250,000, according to the settlement.
Prior to this case, FINRA had fined VSR Financial $550,000 in 2013 for failing to establish and enforce a reasonable supervisory system regarding the sale of alternative or non-conventional investments.
If you have suffered significant losses as a result of your investment with VSR Financial Services, Charles Chapman or another firm, you may have a valid securities arbitration claim. To find out more about your legal rights and options, contact a securities fraud attorney at Law Office of Christopher J. Gray, P.C. at (866) 966-9598 or newcases@investorlawyers.net for a no-cost, confidential consultation.
FINRA Disciplines Former VSR Financial Broker Stahler
During August 2014, Financial Industry Regulatory Authority (FINRA) filed a complaint against Steven L. Stahler, formerly a broker with VSR Financial Services, for making unsuitable recommendations to his customers. Allegedly, Stahler recommended high concentrations of private placements and real estate investment trusts (REITs) that exceeded his clients’ stated risk tolerance and investment objectives.
His recommendations included the following:
• AmREIT Monthly Income & Growth Fund
• Arciterra Whitefish Opp Fund
• Arciterra Real Estate Inv. Trust
• Atlas Resource Public #17-2008
• Behringer Harvard Opp REIT I
• Bradford Drilling Assoc.
• Cole Credit Prop. Trust II
• CNL Income Fund
• Cypress Equipment Fund XII
• Cypress Growth Fund
• Cypress Income V
• Florida Capital Real Estate Partners
• Icon Leasing Fund Eleven
• Inland American REIT
• KBS Real Estate Trust
• Laeroc Edge Fund
• Lease Equity Appreciation Fund II
• LEAF Equipment Leasing Income Fund III
• LEAF Commercial FInance Fund 8.25% note
• Mewbourne Energy Partners
• MPF Income Fund
• MPF Senior Note Program
• Odyssey Diversified Notes VII
• Odyssey Operating Partnership II
• Odyssey Residential II 9% Notes
• United Development Funding
Prior to this case, FINRA had fined VSR Financial $550,000 in 2013 for failing to establish and enforce a reasonable supervisory system regarding the sale of alternative or non-conventional investments.
Stahler has worked with Berthel Fisher & Co., Ausdal Financial Partners, Lowell & Company, Inc. since leaving VSR.
If you have suffered significant losses as a result of your investment with VSR Financial Services, Steven L. Stahler, or another firm, you may have a valid 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 or newcases@investorlawyers.net for a no-cost, confidential consultation.