Unfazed by Charges, Seniors Still Swoon for David Lerner

[GeorgiaGulf]

http://www.lifehealthpro.com/2014/08/26 ... woon-for-d


Where there’s a will there’s a way. This turn of phrase might best sum up news that one brokerage firm is still pitching a niche investment product after running afoul of the Financial Industry Regulatory Authority.

According to TheStreet, David Lerner, founder and president of David Lerner Associates, lost his brokerage license for a year as a part of a 2012 settlement with FINRA over misleading sales claims and other violations. The focus of the charge: the firm’s marketing of illiquid, non-traded real-estate investment trusts or REITs to “unsophisticated and elderly" clients.

Fast forward to 2014. After paying financial penalties — Lerner personally coughed up $250,000 in fines and his firm chalked up another $14 million in fines and restitution to investors — the brokerage is again pitching its “Apple REIT Ten” product to seniors.

Why press on with the same product-push, and to the same target audience, after incurring such steep financial penalties?

“REITs are alluring to investors seeking yield because they distribute at least 90 [percent] of their taxable income to shareholders,” TheStreet writes. “But unlike exchange-traded REITs that can be bought and sold on a stock exchange, non-traded REITs have a limited secondary market.”

The investment vehicle’s appeal aside, one wonders whether FINRA needs to strengthen its penalties and/or rules to discourage potentially recidivist brokers from repeatedly taking advantage of elderly investors. Perhaps the “retrospective review initiative,” launched by FINRA in April, would be an appropriate forum for focusing on this issue.

—Warren S. Hersch

Company founder David Lerner lost his brokerage license for a year as a part of a 2012 settlement with FINRA over misleading sales claims and other violations.

[GeorgiaGulf]

Original article from TheStreet.com

http://www.thestreet.com/story/12783630 ... pitch.html

[ccppww]

David Lerner sales pitches are now perfectly legal.

They adds disclaimers to their presentations and state that this investment is not for everyone.

They inform people about borrowing money to pay dividends, that their sales fees are included
in the price of the shares, and how great the Apple REITS that they have sold have done in the
past. They show you the great locations of the extended stay hotels that they purchase.

They state that past performance is no indication of future performance.

They may leave out some of the negative aspects of this investment but this is sales.

More power to them and more money into the pockets of David Lerner and their investment counselors.

There are jobs available for investment counselors if anyone is interested.

God Bless Poppy and Company!

[Sambotv]

Au contrararie to the above, DLA's pitches ARE NOT NOW PERFEcTLY LEGAL!!

It's VERY MISLEADING to say that the fees are included in the price of the shares..... Do they also state how much the PRICE OF THE SHARES ARE AFFECTED BY THE SALES CHARGE and that ONLY 87 CENTS OF EVERY DOLLAR GOES TO WORK??

A hefty price for a lukewarm chicken dinner!

Just a bunch of hucksters and carnival barkers.

[fedup]

Pardon me folks,,,, but isnt Apple 10 closed to new investors? Didnt Glade pull the plug on the offering? See apple 10 SEC filing.

[Sambotv]

Yes the article was dated from June...

What are the one trick ponies hawking now, annuities? You don't think they are selling them the same way? These crooks couldn't walk a straight line if their lives depended on it

[stevestevenyny]

Hopefully, there is an Apple REIT 11 on the horizon.

[FloridaSam]

As there is no Apple REIT 11 currently in the works, it could be years before anything happens with the Apple Hospitality REIT. The Knight family have a nice business just the way it is.

[Sambotv]

So last Friday Thomas Spota, the Suffolk Co, NY District Attorney, announced he was pressing charges against two chimney sweeps, for targeting several elderly people and swindling them out of several thousand dollars. He is treating this as A HATE CRIME BECAUSE ELDERLY PEOPLE WERE TARGETED. If Mr. Spota is successful, they can be sentenced to life imprisonment.

Strange world, huh? 3 seniors are bilked out if $3000 to $5500 and the scammers might get life...... Where is the justice? David fraudulently scammed seniors out of their rent and grocery money for millions, and Poppy gets the proverbial slap on the wrist!

The elderly are A PROTECTED CLASS OF PEOPLE AND TARGETING THEM TO FLEECE THEM IS A HATE CRIME.
( notwithstanding that they get a bad chicken dinner and some door prizes).