Were You Affected By Inland American, Inland Western REITs?
Unsuitable investments in Inland American Real Estate Trust and the Inland Western Retail Real Estate Trust have become a growing source of concern for more investors these days. In many cases, sales of Inland REITs were appropriate from the start for some investors. Why? Because the broker/dealers behind the deals failed to disclose all of the necessary information associated with the products, including the high commissions that the REITs commanded. In some instances, those fees exceeded 15%.
The Inland REITs are considered unlisted REITs; they do not trade on national stock exchanges. Redemptions in unlisted REITs are limited and almost always have a minimum holding period. If investors want to exit an unlisted REIT entirely, they usually can only do so at specified times.
Perhaps the biggest criticism of unlisted REITs has to do with their lack of transparency. Unlisted REITs also typically come with no independent source of performance data. Moreover, critics of unlisted REITs cite the often vague prospectus language regarding their formal exit strategies.
In recent months, we’ve heard from several investors who say their broker/dealer never discussed the various risks that investors take on when they purchase shares of an unlisted REIT. In reviewing these complaints, we’ve also discovered that some investors were kept in the dark about the fact that their investment in an unlisted REIT could literally be tied up for an undetermined amount of time in the event the REIT suspends its share-repurchase program.
That’s exactly what happened with Inland American, which suspended its buyback program in March 2009. Investors had two options: Hold onto their shares until buybacks become re-instated or attempt to sell their share, at a significant loss, on the secondary market.
If you believe your broker/dealer failed to provide adequate information concerning investments in the Inland American Real Estate Trust, the Inland Western Retail Real Estate Trust or another unlisted REIT, contact us.
March 5th, 2010 at 10:15 am
My husband, Thomas, and I were sold both the Inland American and Inland Western REIT by our Amerprise finanical advisor. We are certain that these REITS were offered to us because they were lucrative for the advisor. We stated that we were planning to retire in a few years. These investments were not appropriate to our needs. We want justice (and monetary damages) so that Ameriprise can pay. I am also aware of the SEC ruling of July 10, 2009 against Ameriprise for the Carey and CNL REITS. These were also sold to us by Ameriprise. We want these people to pay for lining their pockets and making us continue to work instead of enjoying our retirement.
Please contact me. We want to right the wrongs perpetrated by Ameriprise.
Sincerely,
Maryanne
March 30th, 2010 at 12:20 pm
My wife and I were also sold Inland Western REIT shares and were not advised of the risks which have resulted in devaluing of the investment with the addition of non-liquidity. I would like to join in any class action against Ameriprise and/or Inland.
Ronald
April 23rd, 2010 at 11:59 am
My wife and I were also sold Inland Western REIT shares thru Ameriprise and were not advised of the risks which have resulted in devaluing of the investment with the addition of non-liquidity. I would like to join in any class action against Ameriprise and/or Inland.
Jerry
April 29th, 2010 at 12:57 pm
I was sold Inland American REIT shares through Ameriprise and I do believe I was not thoroughly advised of the risks associated with the investment. I was told I could buy back in a couple of years and when a cash setback occurred was stunned to find out that the buyback program was suspended. My Ameriprise advisor had assured me only months before that everything was okay with Inland and that I had “no worries” if I needed to get money out. As a result of the suspended program I have already lost a significant amount of money from having to sell some of my shares on the secondary market because of my financial crisis. I would love to know if any thing can be done about this!
April 29th, 2010 at 5:15 pm
Was sold Inland Western REIT through Ameriprise in 2005 and was told I could probably sell after one year. Financial Advisor told me his mother just loved getting the monthly checks. Actually I did also until I needed cash for dental implants in 2007 and advised me to take out of CD savings instead. Again in 2008 he told me the downturn in real estate mkt. only opened new opportunities for Inland and it would be crazy to cash in. At this point, I contacted Inland directly and was told they were unable to buy back the units. Also, had CNL thru Ameriprise and which resulted in a loss. Don’t want to be burned again. Am real curious about amount of commission Ameriprise received on both these transactions. It was not clear on the confirmations.
May 31st, 2010 at 7:28 pm
I purchased shares thru “Financial Solutions” and have the same problem as those above.
Contacted the main office and was assigned a case manager. The independent broker lied to the case manager and said he never told me “things
were ok with Inland Western” when I wanted to sell my shares and that I could sell them later even if the re-purchase program closed. The broker never warned me of any risk of devaluing of the investment with the addition of non-liquidity.
June 4th, 2010 at 8:21 pm
I purchased shares based on the recommendation of the advisor at my bank for my mother who is a senior living on social security and dividends from her savings. He suggested that it was a very solid and secure investment and not likely to lose value and that I would be able to liquidate it without penalty after 5 years or with a decreasing penalty up to that point. Now it is 4 years later and I find out I can’t sell my shares even at a penalty. I’m very upset. My mother is dependent on this money and I feel like I’ve been duped. This is indicative of a fraudulent system that takes advantage of hard-working people in order to benefit the wealthy few. Disgusting. I hope someone will put together a class-action lawsuit so that shareholders can recover their funds. At this point I’d be happy to cash it in at a 5 or 10% loss but that scenario doesn’t look plausible right now.
June 15th, 2010 at 9:52 am
I was sold my shares by Atlanta Capitol Group and was told this was not a tipical REIT in that they were not highly leveraged and a real estate market downturn would be good buying opportunities for them. I am retired and this was a good portion of my income. I guess I will just wait and see. Maybe long term they will recover at least a portion of their losses.
August 31st, 2010 at 5:48 pm
AMeriprise Financial Advisors receive a maximum of 4.55% (equal to all ofther sales commissioned products. Inland American / Western actual pay out 7% commission to all other financial professionals.