Lighthouse Capital Group: A Closer Look at Complaints and Lawsuits

Lighthouse Capital Group, a financial advisory firm, has been the subject of numerous complaints and lawsuits in recent years. Haselkorn & Thibaut is currently examining possible cases of investment fraud involving clients of Lighthouse Capital Group, LLC (Lighthouse Capital Group), a firm based in Pasadena, California. In May 2023, Lighthouse Capital Group agreed to an Acceptance, Waiver, and Consent (AWC) with the Financial Industry Regulatory Authority (FINRA), leading to the firm’s censure and a penalty fine of $250,000.

The AWC reveals that between 2017 and 2018, Lighthouse Capital Group managed to raise $273 million through 65 private offerings. However, their supervisory system, including their written supervisory procedures, was not adequately structured to adhere to SEC Regulations, thereby failing to prevent general solicitation. Lacking a comprehensive supervisory system, Lighthouse Capital Group was also unable to meet FINRA suitability requirements designed to safeguard investors and properly oversee the sale of new private offerings.

Lighthouse Capital Group’s expertise lies in the sale of private real estate offerings, typically structured as Delaware Statutory Trusts (DSTs). Over the past four years, the firm’s offerings have included a range of ExchangeRight Net-Lease DSTs, the ExchangeRight Income Fund, and other real estate DSTs and real estate investment trusts (REITs). According to SEC Rules, these private offerings should only be sold to eligible investors.

If you invested with Lighthouse Capital Group, please call our experienced investment fraud lawyers at 1-800-856-3352 for a free consultation.

Complaints Against Lighthouse Capital Group

Tenant-In-Common (TIC) Real Estate Sales Practices

Lighthouse Capital Group has faced criticism over its sales practices related to Tenant-in-Common (TIC) real estate products. Advisors Rena Morris and Stephen Holt, both employed by the firm, have been accused of conducting limited due diligence for these investments. TIC investments have been linked to significant investor losses and are generally considered unsuitable products due to their illiquidity and the risk of property devaluation and excessive fees.

Failed Due Diligence on DST Investments

Morris and Holt were also implicated in a case involving a 1031 exchange transaction with Delaware Statutory Trusts (DSTs). It was alleged that they failed to conduct due diligence on the DST investment recommended by them, which resulted in the loss of clients’ retirement savings due to the foreclosure of the underlying property.

Pension Transfers into Sipps

The Financial Ombudsman Service upheld 34 complaints against a Lighthouse arm regarding pension transfers into Sipps. The complaints related to advice given between 2003 and 2008 by the Falcon Group, which merged with Lighthouse in 2008. The ombudsman ruled against Falcon in cases where clients were advised to invest in unlisted companies and exposed to concentrated risks.

Upfront Fee Taking

Lighthouse Capital Group, based in Myrtle Beach, South Carolina, was accused of being an upfront fee taker with no lending success. The company allegedly collected upfront fees without providing due diligence or site visits.

In response to these complaints, several lawsuits have been filed against Lighthouse Capital Group. The Wolper Law Firm filed a $1 million FINRA arbitration claim against the firm based on the recommendations of Morris and Holt. The claim alleges that the advisors failed to conduct due diligence on the DST investment, leading to significant losses for their clients.

Investors who have suffered losses due to the actions of Lighthouse Capital Group are advised to consult with legal firms experienced in securities arbitration, such as Gana Weinstein LLP.


The complaints and lawsuits against Lighthouse Capital Group highlight the importance of due diligence in investment decisions. Investors are encouraged to thoroughly research any financial advisory firm and its advisors before entrusting them with their investments. It’s also crucial to understand the nature and risks associated with any investment product recommended by these firms.

Need help? Please call our investment fraud lawyers at 1-800-856-3352 for a free consultation.

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