Erez Law recently filed a FINRA arbitration against Truist Investment Services, Inc. (formerly known as SunTrust Investment Services Inc.) related to Northstar Financial Services (Bermuda) Ltd. investment losses.
Their customer was a client of Luis Larios and Stephen Berrocal, who was also listed as an advisor of record for the sale of the investments related to this complaint. When Luis Larios terminated his employment with Truist Investment Services, Inc. in 2017, Stephen Berrocal became the sole advisor of record for the client, including for her Northstar Global Advantage V investment, and he provided other investment services to the client.
The Erez Law client, who was a small business owner in Florida and a long-time client of SunTrust Bank, alleges the following in the newly filed FINRA claim:
According to the statement of claim, in or about December 2015, Luis Larios recommended that the client invest $1 million in Northstar Financial Services (Bermuda) Ltd. Global Advantage V, a high-risk and unsuitable offshore product with a five-year term. It is alleged that Luis Larios represented that the Northstar investment was a secure investment that will preserve the client’s capital. Instead, it is alleged that other alternatives could have easily preserved the client’s principal and generated a return, including highly rated offshore investments.
Erez Law alleges that Luis Larios generated a large commission by recommending Northstar Financial Services (Bermuda) Ltd. Global Advantage V and placed his financial interests above his client’s.
It is alleged that the Erez Law client was unfamiliar with Northstar Financial Services (Bermuda) Ltd., had never heard of Northstar Financial Services (Bermuda) Ltd. prior to her dealings with Larios and certainly did not request to invest in Northstar. Additionally, the client never sought out or requested an offshore investment.
According to the claim, the firm is vicariously liable for the acts and omissions of its employees and its other agents by virtue of the doctrine of respondeat superior and actual or apparent authority.
The claim alleges that the Northstar Global Advantage V investment that Luis Larios solicited paid a meager guaranteed level of interest of 2.15%. The client was not seeking a high level of return and was never told that she was subject to a risk of losing his capital in order to achieve a paltry 2.15% return.
According to the claim, Truist Investment Services, Inc. was required to perform due diligence on Northstar Financial Services (Bermuda) Ltd. and ensure that the investments were suitable for its clients and that the firm and its brokers understand the risks of the investments. Northstar Financial Services (Bermuda) Ltd. allegedly failed its due diligence obligations by approving Northstar Financial Services (Bermuda) Ltd. for sale without making adequate disclosures of the risks of loss in the event that the investment failed.
It is alleged that Truist Investment Services, Inc. and Luis Larios failed to adequately disclose to the client that there was a risk that the principal would not be returned. Truist Investment Services, Inc. and Luis Larios are alleged to fail to adequately disclose to the client that they recommended an offshore investment that lacked the protections attendant to U.S. based investments. Neither Truist Investment Services, Inc. nor Luis Larios disclosed in any meaningful manner to the client that the capital was at risk at all due to a potential failure of Northstar Financial Services (Bermuda) Ltd.
According to the claim, Truist Investment Services, Inc. recommended an unduly high concentration in Northstar Financial Services (Bermuda) Ltd. Global Advantage V. The level of concentration only served to increase the level of risk to which the client was unknowingly exposed and caused the investment to be yet more unsuitable.
Neither Truist Investment Services, Inc. nor Luis Larios adequately disclosed to the client that in the event that Northstar Financial Services (Bermuda) Ltd. had a change in ownership that its financial ability to repay investors or creditworthiness could be negatively impacted.
Regrettably, this is not an isolated incident. Truist Investment Services, Inc. has been actively selling Northstar Financial Services (Bermuda) Ltd. investments to investors that have now come to learn that they may have lost most or all of their investment.
How to File a Claim Against Luis Larios
Erez Law represents investors in the United States for claims against brokers and brokerage firms for wrongdoing. If you have experienced investment losses, please call us at 888-840-1571 or complete our contact form for a free consultation. Erez Law is a nationally recognized law firm representing individuals, trusts, corporations and institutions in claims against brokerage firms, banks and insurance companies on a contingency fee basis.
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