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Independent Financial Group Ordered to Pay $1 Million for Unsuitable Private Investments

Independent Financial Group Ordered to Pay $1 Million for Unsuitable Private Investments. Alternative Investment, Independent Financial Group, REIT, Real Estate Investment Trust, Financial Services, Commercial Real Estate, Advisor, Brokerage, Broker-Dealer

Independent Financial Group LLC, an independent broker-dealer, along with a former registered representative was ordered by the Financial Industry Regulatory Authority to pay a total of $1 million to an elderly couple and their related entities for unsuitable investments in private securities.

According to a recent arbitration award, Arthur and Edna Sitelman accused Independent Financial Group and former broker Armando Roman of misconduct related to direct placement program investment recommendations. The alleged violations included fraud, elder abuse, breach of contract, fiduciary duty breaches, and non-compliance with state and federal securities laws, as well as FINRA regulations. The Sitelmans brought the claim both individually and in their representative capacities for Arthur Sitelman IRA, The Good Daughter LLC, and Faraway Assets LLC.

Several programs were noted in the Sitelmans’ cause of action including: Strategic Storage Trust Inc.; Griffin-American Healthcare REIT III Inc.; FS KKR Capital Corporation III; American Realty Capital Trust V Inc.; American Realty Capital Healthcare II Inc.; Walton US Land Fund 3 LP; NorthStar Healthcare Income; CION Investment Corp; and Griffin Capital Essential Asset REIT II.

A three-person FINRA arbitration panel found Independent Financial Group and Roman both jointly and severally liable and ordered them to pay a total of $1 million in compensatory damages, including $400,000 to Arthur Sitelman IRA, $100,000 to The Good Daughter LLC, and $500,000 to Faraway Assets LLC. Roman’s request for expungement was also denied by the panel.

The Sitelmans had originally requested $3.5 million in damages.

According to its BrokerCheck profile, Independent Financial Group has 15 regulatory disclosures.

Per his Investment Adviser Public Disclosure record, Roman is no longer registered as a broker and is now an investment advisor with Axiom Founders Family Office. According to a comment on his profile regarding the case, Roman wrote, “Firm intends to defend claims as without merit. There is no evidence to support the claims or the damages. Investments made were in line with stated objectives, risk tolerance, and time horizon.”

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