Luke Johnson, a previous associate at Legend Capital Group and Coastal Equities, has received a permanent ban by the Financial Industry Regulatory Authority (FINRA) from operating as a broker or having any affiliation with a broker-dealer firm. This consequence comes in the wake of Johnson’s inappropriate suggestions to a group of nine customers to invest an excess of $2.35 million in non-liquid alternative investments.
The non-liquid alternative investments proposed by Johnson incorporated entities such as Cunat Multi-Family Investment Fund, American Realty Capital Hospitality Trust, GPB Holdings, GWG Holdings, MCI Preferred Income 8 Fund II, Priority Income Fund, and MVP REIT.
Having previously been registered with Prime Capital Investment Advisors and Coastal Equities, Johnson has now received a permanent bar from FINRA. This decision comes after his misrepresentative recommendations led to overinvestment of customers’ liquid net worth in risky securities. Johnson or his assistants, acting under his instruction, allegedly tampered with the customers’ net worth and liquid net worth data on their account forms and alternative investment paperwork.
Coastal Equities’ written supervisory procedures expressly forbade recommendations that would result in over 35% of a client’s liquid net worth being tied up in alternative investments. However, Johnson is accused of data manipulation to sidestep this rule and evade oversight.
Moreover, Johnson advised the acquisition of unregistered securities, such as limited partnership interests in GPB Capital. Such recommendations were only apt for accredited investors with significant financial resources. He also allegedly guided clients to invest in other non-liquid and speculative alternatives, like non-traded REITs and risky investments.
Recover Losses With Investment Fraud Lawyers
Investment fraud lawyers specialize in cases involving securities fraud and financial misconduct. They play a critical role in helping clients recover losses through a FINRA (Financial Industry Regulatory Authority) claim. Here’s how they can assist:
- Case Evaluation: An investment fraud attorney can help evaluate the facts of your case, identify potential legal issues, and advise on the viability of pursuing a claim. They assess the investor’s documentation, trading records, correspondence, and any other relevant information.
- Understanding of Regulations: These attorneys have in-depth knowledge of complex securities laws and FINRA rules. They can pinpoint where and how a broker or brokerage firm may have violated these laws.
- Filing a Claim: If a valid claim exists, an investment fraud attorney can file an arbitration claim with FINRA on behalf of the investor. They will prepare a detailed statement of claim that outlines the misconduct, explains the laws or rules that were violated, and specifies the damages sought.
- Representation in Proceedings: The attorney represents the investor throughout the arbitration process. This includes pre-hearing conferences, the exchange of evidence with the other side (discovery), and the arbitration hearing, a trial-like proceeding where both sides present evidence and argue their case.
- Settlement Negotiation: Often, cases may settle before the arbitration hearing. An experienced attorney can negotiate with the other side to reach a settlement that adequately compensates the investor for their losses.
- Appeals: If the arbitration panel’s decision is unfavorable, it may be possible to appeal in certain circumstances. A lawyer can guide clients through this complex process.
It’s worth noting that each case is unique. The actual steps a lawyer takes may vary depending on the individual circumstances of each client’s case. It’s also important to know that while an investment fraud lawyer can increase your chances of recovery, they cannot guarantee a successful outcome.
Those investors who faced financial losses due to Luke Johnson might be eligible for financial restitution. Haselkorn & Thibaut, a top-tier law firm specializing in investment fraud with over five decades of experience and a history of success, is available to help investors examine their recovery possibilities. With branches in Florida, New York, North Carolina, Arizona, and Texas, Haselkorn & Thibaut offers a free consultation at 1-800-856-3352 and operates under a “No Recovery, No Fee” principle, only charging legal fees if they succeed in securing financial recovery for their clients.
If you have suffered investment losses in connection with Luke Johnson, get in touch with Haselkorn & Thibaut to discuss your situation and consider your prospects for recouping your losses. Their proven skillset, vast experience, and impressive success rate make them an optimal choice for investors seeking reparation in cases of investment fraud.
