Illiquid alternative investments have been a cause of particular concern for securities regulators and watchdogs in recent years. Among the products that have garnered the most notoriety are non-traded Real Estate Investment Trusts (“REITs”), non-traded Business Development Corporations (“BDCs”), and oil and gas private placements. Non-Traded REITs A REIT is an investment…
A battle is underway in a federal district court in Florida between the SEC and Carl Ruderman, the disgraced former CEO and Chairman of 1 Global Capital, LLC, over whether or not allegedly fraudulent investments issued by 1 Global Capital are “securities” for purposes of applying federal securities laws. The…
Brokerage firms owe their customers a duty of fair dealing, which includes the duty to disclose certain material information (i.e., information the customer would consider important as an investor). SEC Guide to Broker–Dealer Registration (April 2008). Although the issue of materiality often turns on the facts and circumstances of a…
The Racketeer Influenced Corrupt Organizations Act (“RICO”) makes it unlawful for “any person” to conduct, or participate in, the affairs of an enterprise affecting interstate commerce “through a pattern of racketeering activity.” 18 U.S.C. § 1962(c). “Racketeering activity” is defined as conduct that is “chargeable” or “indictable” under certain federal…