Investors who have invested in UDF IV and who have experienced losses may want to consider pursuing compensation of their losses through a group arbitration or class action suit. By now, most are familiar with the United Development Funding IV Ponzi scheme; even worse, you may be a victim or know someone who is.
Some of the broker-dealer firms involved in the sale of these real estate investments include VSR Financial Services, Berthel Fisher, IMS Securities, Inc., Securities America, Eagle Financial, and Centaurus Financial Inc. If you aren't really certain what a Ponzi scheme is, it is described by the SEC as "an investment fraud that involves the payment of purported returns to existing investors from funds contributed by new investors."
Brokerage firms are often guilty of not performing thorough research before recommending investments to their clients. Essentially, the firms named above along with others had a duty to conduct adequate due diligence on these real estate investment products, but
failed to do so. Now, countless investors have found themselves victims, losing the money they believed they were investing in a legitimate, profitable stock. These brokers sold UDF IV without, apparently, having performed sufficient due diligence to recognize that it was a Ponzi scheme—just like the advisory firms who invested their clients’ funds in Madoff’s Ponzi scheme.
Group arbitrations for victims of the UDF IV Ponzi scheme are now being formed, as more and more investors are learning of their loss. A group exists for investors who were sold UDF IV by Berthel Fisher, another group arbitration is being formed for investors who bought UDF IV through Securities America, VSR, IMS Securities and Eagle Financial, etc.
The good news is that through a group arbitration against the brokerage firm that recommended UDF IV without having done the required due diligence, it may be possible to recover all of a portion of your losses. Investors put their faith and trust in their brokerage firms and advisers, and are unfortunately often taken advantage of.
The brokerage firms should be held accountable for their negligence and failure to do their due diligence as to UDF IV. If you are interested in joining a group arbitration, please complete the form and submit it or call attorney Diane Nygaard at 816-531-3100.