Moody National REIT II, Investigating Potential Securities Claims
The White Law Group is investigating potential securities claims involving the liability brokerage firms may have for recommending Moody National REIT II to investors.
Moody National REIT II, a non-traded real estate investment trust (REIT), invests in hotel and securities. Last April, due to the global coronavirus (COVID-19) pandemic the company to suspended its public offering and distribution payments, as well as its share repurchase program. The company also terminated its IPO.
Potential Lawsuits to Recover Financial Losses
The trouble with non-traded REITs, like Moody National REIT II, is that they involve a high degree of risk. They are also typically sold as unregistered securities which lack the same regulatory oversight as more traditional investment products like stocks or bonds.
Non-traded REITs are also known for high sales commissions and due diligence fees. Brokers have an enormous incentive to push these products to unsuspecting investors who do not fully understand the risks. Sometimes brokers misrepresent the basic features of the products – usually focusing on the income potential and tax benefits while downplaying the risks.
Another problem with non-traded REITs, is the lack of liquidity. According to SEC filings, Moody plans to complete a liquidity event within three to six years from the termination of its IPO. If you want to sell your investment through a secondary market before then, you may lose money on the sale.
According to Central Trade and Transfer, shares of Moody National Reit II were recently sold for just $8.50 per share. This may mean significant losses for investors as the original purchase price was $25.00 per share.
If a broker or brokerage firm makes an unsuitable investment recommendation or fails to adequately disclose the risks associated with an investment, they may be found liable for investment losses in a FINRA arbitration claim.
If you are concerned about your investment in Moody National REIT II or another non-traded REIT, please contact The White Law Group at 1-888-637-5510 for a free consultation.
The White Law Group, LLC is a national securities fraud, securities arbitration, investor protection, and securities regulation/compliance law firm with offices in Chicago, Illinois and Seattle, Washington. The firm represents investors throughout the country in claims against their brokerage firm.
For more information on the firm and its representation of investors, visit www.WhiteSecuritiesLaw.com.