Update on Northstar Bermuda Investment Losses Cases

Northstar LogoMany investors have watched their hard-earned money lost in Northstar Financial Services (Bermuda) investments. A recent ruling in the Northstar bankruptcy case could mean that some investors in Northstar fixed investments may not receive their capital or any return on the funds they invested. However, the investment loss attorneys at Erez Law, PLLC are fighting to protect the rights of investors who were defrauded by brokers.

At Erez Law, PLLC, we focus on helping offshore investors like you from Venezuela, Argentina, other parts of Latin America, and the rest of the world navigate the complex process of pursuing financial recovery after suffering significant investment losses. Call us today or contact us online for a free case review with a Northstar Bermuda attorney. We can discuss your options during your free, no-obligation consultation.

Background on Northstar Bermuda Litigation and Liquidation

Many former investors in Northstar have filed legal claims alleging that brokers from various brokerage firms recommended unsafe and unsuitable investments from Northstar, failed to conduct due diligence, failed to ensure their clients understood the risks involved in Northstar investments and failed to provide adequate disclosures. Amidst these legal filings, Northstar filed for bankruptcy. The court issued an order to wind up Northstar in liquidation on March 26, 2021, finding that the company had a deficit of more than $260 million and assets of only $8 million. Additionally, the owner of Northstar was found guilty of federal corruption charges and sentenced to seven years in prison.

On July 28, 2023, the court issued a ruling on the rights of Northstar variable and fixed investors, finding that Northstar investors in segregated accounts would have access to assets held in those accounts but that investors in fixed investments, such as Northstar Global Advantage III, Global Interest Accumulator, Global Index Product, Global Advantage Plus Series, and Global Advantage Select, would not have access to assets because no assets had been effectively linked to them and that there would be no assets in relevant segregated accounts to meet the claims of fixed investors.

Some investors have asserted legal claims against brokerage firms, arguing their fraud continued during the ongoing litigation involving Northstar. They allege that brokers have intentionally tried to delay them from pursuing legal action against them, incorrectly informed them that their lack of liquidity or access to their funds was temporary, and assured them falsely that they would be able to recover their capital. These cases are ongoing.

Brokerage Firms that Recommended Northstar Financial Services

The following brokerage firms recommended Northstar Financial Services to their clients:

Ongoing litigation against these firms and the financial advisors who worked for them assert that these firms and brokers committed several grave errors in their handling of Northstar investments, such as:

  • Misrepresenting Northstar as a safe, low-risk product similar to a Certificate of Deposit
  • Promising guaranteed monthly income with principal protection
  • Failing to disclose the true nature of the offshore investment and its associated risks
  • Inflating exit fees, making it difficult for investors to withdraw their funds
  • Over-concentrating client portfolios in these high-risk investments

As a result, many unsuspecting investors suffered losses when Northstar Financial Services (Bermuda) filed for bankruptcy and entered liquidation proceedings. These events have resulted in significant financial upheaval, uncertainty, and anxiety for misled investors caught in their wake. The legal team at Erez Law, PLLC is here to set things right.

Legal Process if You Suffered Significant Investment Losses

If you have suffered financial losses due to Northstar investments, you may have options for seeking compensation. The primary avenue for most investors is through Financial Industry Regulatory Authority (FINRA) arbitration.

In FINRA arbitration, you may be able to recover your investment losses if the arbitrators determine that the brokerage firm or its representatives failed to recommend suitable investments or brokers misrepresented the nature of the Northstar products. Potential grounds for claims include the following:

  • Unsuitability – The investment did not align with your financial goals, risk tolerance, or investment experience.
  • Misrepresentation or Omission – The broker failed to disclose material facts about the investment.
  • Breach of Fiduciary Duty – The firm or advisor put their interests above yours.
  • Negligence – The firm failed to properly supervise its brokers or conduct due diligence on the investments.

There are strict time limits for filing FINRA claims, so do not delay seeking legal advice if you believe your investment firm wronged you.

The process of FINRA arbitration can be complicated, but working with our experienced attorneys can clarify your rights and options and help you seek a favorable resolution. These are the steps involved in disputes, which our FINRA arbitration attorneys can take on your behalf:

  • Filing a Claim – Your attorney files a Statement of Claim with FINRA detailing your losses and the brokerage firm’s alleged misconduct.
  • Respondent’s Answer – The brokerage firm has an opportunity to respond to your claims.
  • Arbitrator Selection – A panel of one or three arbitrators will be chosen to hear your case.
  • Discovery – Both sides exchange relevant documents and information.
  • Hearing – Your lawyer presents your case before the arbitration panel, including any evidence and witness testimony.
  • Decision – The arbitrators will issue a binding decision, typically within 30 days of the hearing.

The entire process usually takes 12-18 months, though complex cases may take longer.

FINRA arbitration offers several advantages over traditional litigation, as it is:

  • Generally faster than court proceedings
  • Often less expensive than going to trial
  • More flexible in terms of evidence and procedure
  • Decisions are typically final and binding

Contact a Northstar Financial Services Bermuda Lawyer if You Have Lost Money

If you have lost money with Northstar Financial Services (Bermuda), contact Erez Law, PLLC today for a free, no-obligation consultation. We can review your case, explain your options, and help you decide on the most effective course of action for your unique situation.

When your financial future is on the line, you need a legal team with a proven track record of fighting for clients’ rights and recovering their financial losses. Among the reasons why you can trust Erez Law, PLLC with your case include the following:

  • We have recovered over $200 million for our clients.
  • We are nationally recognized in the field of investment fraud litigation.
  • Our team has tried more than 50 cases in arbitration.
  • Our attorneys have over 35 years of combined experience in this specific field.

We represent individual investors who have fallen victim to investment fraud and misconduct. Our extensive experience handling FINRA arbitration cases means we know how to manage this complex process and build compelling cases for our clients.

At Erez Law, PLLC, we understand that taking legal action can be daunting, especially when you have already suffered financial losses. That is why we work on a contingency fee basis. You pay us nothing unless we recover money for you, allowing you to access high-quality legal counsel without worrying about further jeopardizing your financial future. Contact Erez Law, PLLC to get started.