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Investor Claims Attorneys Investigate Former Financial Advisor Richard Demetriou

Investor Claims Attorneys Investigate Former Financial Advisor Richard Demetriou

Investor Claims Attorneys Investigate Former Financial Advisor Richard Demetriou

Former financial advisor Richard Demetriou is currently involved in a legal dispute with a customer who alleges that Demetriou overconcentrated the customer’s portfolio in Real Estate Investment Trusts (REITs). Last year, Demetriou was sanctioned by the Financial Industry Regulatory Authority based on the regulator’s findings that Demetriou “made false or misleading misrepresentations of fact in widely distributed emails to current and former customers.” Demetriou was associated with the brokerage firm Titan Securities from 2009 to 2021.

Excessive Concentration

The benefits of diversifying are well established and  have been explained by FINRA as follows:

Asset Allocation. By including different asset classes in your portfolio (for example stocks, bonds, real estate and cash), you increase the probability that some of your investments will provide satisfactory returns even if others are flat or losing value. Put another way, you’re reducing the risk of major losses that can result from over-emphasizing a single asset class, however resilient you might expect that class to be.

Diversification. When you diversify, you divide the money you’ve allocated to a particular asset class, such as stocks, among various categories of investments that belong to that asset class. Diversification, with its emphasis on variety, allows you to spread your assets around. In short, you don’t put all your investment eggs in one basket.

Real Estate Investment Trusts

A REIT is an investment vehicle that uses pooled investor funds to acquire income-producing real estate or mortgages. In order to maintain REIT status, and the tax benefits that come with it, the trust must return at least 90% of its taxable income to investors on an annual basis.

REITs that do not trade on public exchanges are considered illiquid because opportunities for early redemptions are very limited and because secondary market trading is characterized by low volume, a lack of price continuity, and wide bid-ask spreads.

FINRA has described non-traded REITs as “speculative investments that contain a high degree of risk.” In addition to significant default and liquidity risks, id., the risks of investing in non-traded REITs include high fees (upfront and management); distributions from principal (i.e., return of capital); lack of share value transparency; and, conflicts of interest.

Need Assistance?

If you have suffered damages due to the investment fraud or malpractice of Richard Demetriou, we may be able to assist you in recovering some or all of your investment losses. For a free, no-obligation consultation, call toll-free at (1-888) 607-4819 or send us a message over the contact page.