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Securities America Update

The North American Securities Administrators Association (NASAA) has leveled stinging criticism at a federal judge and his decision to halt legal action brought by Massachusetts and Montana regulators against Securities America over soured private-placement sales. Investors lost millions of dollars in the deals, which involve Medical Capital Holdings and Provident Royalties LLC.

NASAA made the charge yesterday in a legal brief filed in a Dallas federal court, according to a March 15 story by Investment News. Last month, Judge W. Royal Furgeson Jr. ordered a temporary halt to the states’ actions, as well as three arbitration cases against Securities America, while he ruled on a proposal to combine all legal claims against Securities America into a single class action.

The crux of the case is the potential money investors stand to recoup. Investors who’ve joined the class action could get between 15 cents and 20 cents per dollar for their investment losses in Medical Capital Holdings and Provident Royalties. Meanwhile, investors with arbitration claims stand to potentially recover 100 cents on the dollar, depending on their claim and the decision rendered by a three-person panel of the Financial Industry Regulatory Authority (FINRA).


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