Wells Timberland REIT
Investors who suffered financial losses in the Wells Timberland REIT received some welcome news when the Financial Industry Regulatory Authority (FINRA) took action against Wells Investment Securities, the broker/dealer distributor for non-traded REIT sponsor Wells Real Estate Funds.
FINRA imposed a $300,000 fine against Wells Investment Securities, stating that the firm used improper sales materials when selling the Wells Timberland REIT from May 2007 to September 2009.
In reaching the settlement, Wells Investment Securities neither admitted nor denied the charges.
According to FINRA, however, marketing materials for the Wells Timberland REIT contained an incredible 116 "improper, unwarranted or exaggerated statements." FINRA further stated that various information concerning diversification, distributions and redemptions of the REIT was misleading.
"By approving and distributing marketing materials with ambiguous and equivocal statements, Wells misled investors into thinking Wells Timberland was a REIT at a time when it was not a REIT," said Brad Bennett, FINRA executive vice president and chief of enforcement, in a statement.
Hundred of investors suffered financial losses in the Wells Timberland REIT, as well as other Wells-sponsored non-traded REITs. In many instances, the products were characterized by broker/dealers as safe, secure and suitable for conservative-income seeking investors.
In reality, those promises never materialized.
If you have invested in the Wells REIT or another non-traded REIT and suffered financial losses, please contact us to tell your story.