YK Law LLP (YK Law) has filed an arbitration claim with the Financial Industry Regulatory Authority (FINRA) on behalf of a Chinese foreign investor (Claimant), who suffered losses as a result of the unsuitable recommendations, failure to disclose material adverse risks, fraud, and misrepresentations which relate to investments in a private offshore Real Estate Investment Trust (REIT) previously-named the Beechwood Bermuda Investment Holdings Ltd. (“Beechwood”) that was recommended by Cetera broker Jiaqi Chen (Jack).
According to the Statement of Claim filed on April 20, Claimant was introduced to the Irvine, CA-based dually-registered Cetera broker and financial advisor, Jack Chen, after opening banking accounts with CTBC Bank Corp. (USA) (CTBC Bank), formerly Chinatrust Bank (U.S.A). Claimant has alleged that the Cetera broker promised an ultra-low risk investment to ensure that Claimant’s money was safe, while still providing a steady rate of income and return. Based upon the Cetera broker’s fraudulent misrepresentations and guarantees, Claimant invested USD$200,000 in the privately traded, offshore, “Beechwood” REIT.
Unbeknownst to Claimant and what should have been known or otherwise disclosed by the Cetera broker at the time, was that Beechwood was inexplicably intertwined with Mark Nordlicht with the hedge fund Platinum Partners. In fact, within months after Claimant’s investment was made, FBI agents arrested Nordlicht on charges related to a USD$1B fraud alleging operations of a Ponzi scheme. See SEC v. Platinum Management (NY) LLC, et al. Dec. 2016. Nordlicht was ultimately found guilty by jury verdict in a New York federal court.
The Statement of Claim further alleges that the Cetera broker knew that Claimant’s investment had been lost as a result of the highly risky, fraud-linked underlying investment, yet failed to inform Claimant of the truth. It further alleges that the Cetera broker forged documents in a futile attempt to cover up the losses and trick Claimant into believing that everything was okay.
While Cetera and its registered broker-advisors are not the only firm who likely sold this investment, it is alleged and believed that the broker-dealer appears to have encouraged its registered representatives to sell these risky investments, especially to foreign Chinese investors like Claimant, who have since then sustained huge, if not total, losses of their investment. Meanwhile, Cetera and its registered representatives made off with abnormally high commissions and fees for completing these transactions.
Claimant is represented by Edward Chen of the Los Angeles, CA office of YK Law.
If you are an investor or know any investors who have suffered losses from any Beechwood-Platinum related funds, with Cetera Investment Advisors, Cetera Broker Jiaqi (Jack) Chen, or were introduced to any of these related parties by third-party financial institutions such as CTBC Bank, we strongly suggest that you contact YK Law today for a free, confidential evaluation of your investment situation and potential legal rights.
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