Vernon Litigation Group, a Naples, Florida securities law firm, is actively investigating claims on behalf of investors who were sold any Inspired Healthcare Capital offerings. Inspired Healthcare recently announced that the SEC (Securities and Exchange Commission) is conducting a regulatory investigation.
As part of this development, Inspired Healthcare has halted all income distributions to investors and will not be bringing any new fund offerings to market. Without these income distributions, the funds have effectively become worthless to investors, as they cannot be sold in any open market. Meanwhile, the brokerage firms that sold these speculative investments received large commissions upfront, leaving investors to wait out the SEC’s investigation of Inspired Healthcare Funds with no return.
Risks of Alternative Investments Like Inspired Healthcare Funds
Alternative investments, including Inspired Healthcare funds, are non-conventional investments subject to the guidelines of NASD Notice to Members 03-71. FINRA has specifically cautioned firms that:
“Given the complex nature of NCIs [Non-Conventional Investments, also known as Alternative Investments] and the potential for customer harm or confusion, members are cautioned to ensure that their sales conduct procedures fully and accurately address any of the special circumstances presented by the sale of NCIs. Additionally, NASD is concerned that investors, particularly retail investors, may not fully understand the risks associated with these products.”
FINRA also reminded broker-dealers offering Non-Conventional Investments, such as private placements and other alternatives of their obligations to:
- Conduct adequate due diligence to understand the product’s features.
- Perform reasonable-basis suitability analysis.
- Conduct customer-specific suitability analysis for any recommended transactions.
- Provide balanced disclosures of both risks and rewards, especially when selling to retail investors.
- Implement appropriate internal controls.
- Train registered representatives on the features, risks, and suitability of these products.
Brokerage Firms May Have Failed to Meet Standards
Our investigation has revealed that independent broker-dealers selling Inspired Healthcare Capital offerings may have failed to meet these stringent regulatory requirements. This could mean that investors were improperly advised, leading to substantial and unnecessary financial losses.
If you purchased any Inspired Healthcare funds and have experienced losses, you may have legal claims to recover your investments. Vernon Litigation Group can review your case, explain your rights, and help you understand your potential recovery options.
Contact a Naples Securities Attorney Today
We offer free case evaluations for investors who suffered losses due to Inspired Healthcare Capital offerings or other unsuitable alternative investments. You do not have to face this complex legal process alone—our experienced securities attorneys are here to help you pursue the compensation you deserve.
Schedule your initial consultation with Vernon Litigation Group today by calling our office at (239) 319-4434 or completing our online contact form.