NEW YORK, Oct. 22, 2012 (GLOBE NEWSWIRE) -- The Securities Arbitration Law Firm of Klayman & Toskes ("K&T") (http://www.sue-davidlerner.com) announced today that David Lerner Associates ("DLA") was sanctioned by the Financial Industry Regulatory Authority ("FINRA"), ordering the brokerage firm to pay about $12 million in restitution to affected customers who purchased shares in Apple REIT Ten, a non-traded $2 billion Real Estate Investment Trust ("REIT"), and to customers who were charged excessive markups on municipal bonds and CMOs. FINRA also fined the founder, President and CEO of DLA, David Lerner, $250,000 and suspended him from the securities industry for one year, followed by a two-year suspension from acting as a principal.
According to FINRA, "as the sole distributor of the Apple REITs, DLA solicited thousands of customers, targeting unsophisticated investors and the elderly, selling the illiquid REIT without performing adequate due diligence to determine whether it was suitable for investors." To sell Apple REIT Ten, FINRA added, "DLA also used misleading marketing materials that presented performance results for the closed Apple REITs without disclosing to customers that income from those REITs was insufficient to support the distributions to unit owners." Moreover, FINRA said, "David Lerner personally made false claims regarding the investment returns, market values and performance and prospects of the Apple REITs at numerous DLA investment seminars and in letters to customers. To encourage sales of Apple REIT Ten and discourage redemptions of shares of the closed REITs, he characterized the Apple REITs as, for example, a 'fabulous cash cow' or a 'gold mine,' and he made unfounded predictions regarding a merger and public listing of the closed Apple REITs, which he inappropriately claimed would result in a 'windfall' to investors."
K&T is continuing to pursue securities arbitration claims on behalf of Apple REIT investors before FINRA's arbitration department. Apple REIT investors are encouraged to contact K&T to explore their legal rights and options. The attorneys at K&T are dedicated to pursuing claims on behalf of investors who have suffered significant investment losses. K&T, 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 wish to discuss this announcement or invested $250,000 or more in Apple REITs, please contact Steven D. Toskes, Esquire or Jahan K. Manasseh, Esquire of Klayman & Toskes, P.A., at 888-997-9956 or visit us on the web at http://www.sue-davidlerner.com