The Vermont Department of Financial Regulation announced a settlement Friday with LPL Financial, which will reimburse $460,000 to eight Vermont investors. It’s part of a multi-state investigation by the North American Securities Administrators Association (NASAA).
According to the DFR, the investigation found agents at LPL did not comply with certain standards when selling non-traded real estate investment trusts between January 2008 and December 2013. Specifically, agents often failed to adequately consider an investor’s net worth an income when looking at suitability of the investment.
“Non-traded REITs do not have an active secondary market, which can put investors in a bind if they need immediate access to their money,” said Vermont DRF Commissioner Michael Pieciak, “accordingly, these investments are only appropriate for certain individuals.”
“This investigation has been ongoing for several years and the settlement with Vermont is good news for our investors. It is also a great example of how NASAA coordinates the efforts of all state regulators to protect investors,” Pieciak continued.
The restitution to Vermonters ranges from $14,000 to $200,000. More than 2,000 investors were affected nationwide, according to a release from the Vermont DFR.