NASAA Task Force Settles Multi-State Case Against Financial Advisory Firm

The North American Securities Administrators Association's ("NASAA") Non-Traded Real Estate Investment Trust ("REIT") Task Force settled charges against a broker-dealer for failing to (i) implement an adequate supervisory system and (ii) enforce its written procedures regarding its sale of non-traded REITs.

Specifically, the firm, through its agents, (i) sold non-traded REITs in excess of the REITs' prospectus standards, various state concentration limits or the firm's own guidelines, and (ii) failed to implement a supervisory system that was reasonably designed to achieve compliance with state law.

The enforcement action had been brought by 48 states, Puerto Rico, the Virgin Islands and the District of Columbia in a combined enforcement action led by regulators from a smaller group of the states.