The Securities Arbitration Law Firm of KlaymanToskes, announced today that it is currently investigating securities arbitration claims against Wells Investment Securities, Inc. (“Wells Investment”), after the Financial Industry Regulatory Authority (“FINRA”) announced that it fined Wells Investment $300,000 for using misleading marketing materials in the sale of Wells Timberland REIT, Inc. (“Wells Timberland REIT”), a non-traded Real Estate Investment Trust (“REIT”). Wells Investment was the dealer-manager and wholesaler for the public offering of Wells Timberland REIT, which invested in timber-producing land. Wells Investment reviewed, approved and distributed the marketing materials for Wells Timberland REIT. KlaymanToskes has significant experience in representing investors who sustained losses or have money frozen in non-traded REITS.
According to FINRA, “from May 2007 through September 2009, Wells reviewed, approved and distributed 116 advertising and sales materials containing misleading, unwarranted or exaggerated statements. For example, Wells Timberland’s initial offering prospectus stated that it intended to qualify as a REIT for the tax year that ended Dec. 31, 2006; however, it did not qualify for REIT election until the tax year that ended Dec. 31, 2009. The majority of the advertisements and sales literature failed to disclose the significance of Wells Timberland’s non-REIT status or suggested that Wells Timberland was a REIT at a time when in fact it had not qualified as a REIT. The communications also contained misleading statements regarding Wells Timberland’s portfolio diversification and ability to make distributions and redemptions.”
FINRA further said that, “although non-traded REITs are generally illiquid, often for periods of eight years or more, they can avoid particular tax consequences if they qualify under certain Internal Revenue Service requirements. The Wells advertisements at issue did not make it clear to potential investors who might be seeking such favorable tax treatment, that the investment at issue was not yet a REIT and therefore would not be able to offer the desired tax benefits at the time the ads were being used.”
Investors who purchased Wells Timberland REIT can contact KlaymanToskes to explore their legal rights and options. The attorneys at KlaymanToskes are dedicated to pursuing claims on behalf of investors who have suffered significant losses. KlaymanToskes, an experienced, qualified and nationally recognized securities litigation law firm, practices exclusively in the field of securities arbitration and litigation. It continues its representation of investors throughout the world in securities arbitration and litigation matters against major Wall Street brokerage firms.
If you are an investor of Wells Timberland REIT, please contact Steven D. Toskes, Esquire or Jahan K. Manasseh, Esquire of KlaymanToskes, at 888-997-9956 or visit us on the web at https://klamantoskes.wpengine.com