Investigation: Inland American Real Estate Investment Trust, now InvenTrust

The Sonn Law Group is currently investigating complaints related to InvenTrust Properties. Until recently, this firm went by the name Inland American Real Estate Trust. InvenTrust operates one of the nation’s largest real estate investment trusts (REIT).

REITs are notoriously complex and high risk investments. As such, this product is simply unsuitable for many investors.

If you have invested with this brokerage firm, under either name, and you lost money, our investment fraud attorneys want to hear from you.

An SEC Investigation Into InvenTrust

In 2012, the Securities and Exchange Commission (SEC) launched a wide ranging investigation into the practices of InvenTrust. At the time, the company was still known as Inland American Real Estate Trust. This investigation looked into whether or not the company was violating federal law regarding:

• Excessive management fees;
• Unlawful payouts;
• Overpriced buybacks; and
• Mispricing transaction.

SEC investigators were particularly concerned that InvenTrust was overcharging its clients. In early 2015, the SEC cleared the company of any wrongdoing. However, it is still critically important that investors keep a close eye on any investigations.

The bottom line: A firm being subject to an investigation is never an encouraging sign. Indeed, as soon this SEC investigation was closed, an Illinois investor brought a lawsuit against the firm once again alleging that InvenTrust was overcharging its customers.

REITs and Suitability

An REIT is a type of security that invests in real estate, either by owning real property, owning mortgages or both. Essentially, these products are modeled after mutual funds. Their biggest selling point for investors is that they provide an opportunity to get into the real estate market while maintaining a high level of flexibility. It is far easier to buy and sell part of an REIT than it is to actually buy and sell a piece of property.

However, as was mentioned, REITs are simply not suitable for many investors. The benefit of easier access to the real estate market also comes with some serious drawbacks. First, these products generally have high upfront and ongoing fees. Additionally, REITs are also very risky. Representatives of companies like InvenTrust, have a legal duty to avoid aggressively pushing these investments on retail investors.

Sadly, some unscrupulous investment firms lead investors to believe that REITs are a good way to generate passive income. This is simply false. You should avoid REITs and other highly risky investment opportunities if:

• You are over 65 years old;
• You have less than $200,000 in total income;
• You have an immediate need to access cash;
• You have a low or moderate level of personal risk tolerance; or
• You already have a large concentration of your investments in other risky assets.

Request Your Free Legal Consultation Today

If you lost money investing with InvenTrust, we are ready to help. To learn more about what our securities fraud attorneys can do for you, please call us today at 844-689-5754. At the Sonn Law Group, we handle all investment fraud claims on a contingency basis. That means we will not collect our legal fee unless we help you obtain compensation for your losses.