Did you suffer investment losses with former National Securities Corporation broker Mark Kolta (CRD# 5324620) regarding concentration of investments in American Realty Capital New York City REIT?
A REIT is a company, modeled after mutual funds, that owns or finances income-producing real estate and provides investors of all types regular income streams, diversification and long-term capital appreciation. Unlike other real estate investments, REITs are often entirely illiquid. Non-traded REITs hold additional risks for investors because they often feature limited redemption programs, high fees and commissions, and internal conflicts of interest.
Mark Kolta has been registered with Worden Capital Management LLC in Garden City, New York since April 2018. He was also registered with Aegis Capital Corp. in New York, New York from June 2017 to February 2018 and with National Securities Corporation in New York, New York from 2013 to 2017. While previously employed by Chase Investment Services Corp. in New York, New York from 2008 to 2011, Mark Kolta was terminated regarding, “Registered rep advised customers of another brokerage firm in the trading of options during his employment with the firm without the firm’s knowledge or permission.”
According to public records, a couple filed a $450,000 FINRA arbitration against National Securities Corporation and Mark Kolta alleging overconcentration of their investment portfolio in American Realty Capital New York City REIT, a high commission, risky non-traded real estate investment trust sponsored by AR Global. Mark Kolta allegedly misrepresented to the customers that the American Realty Capital New York City REIT was a short-term investment (12-18 months) that would yield 12-18 percent.
According to the fund’s website, “American Realty Capital New York City REIT, Inc. (“NYC REIT”) seeks to provide its investors with a combination of current income and capital appreciation through strategic investments in high-quality commercial real estate located within the five boroughs of New York City, particularly Manhattan.” As of March 2018, the REIT suspended distributions to all shareholders, “to enhance its ability to execute on acquisitions, and conduct repositioning and leasing efforts related to its properties.” According to the REIT’s website on July 14, 2018, the investment is closed to all new investments.
According to an article in The DI Wire, “the REIT had an 11 percent distribution coverage in the third quarter of 2017 and the 6 percent distribution rate was overdistributed by $3.53 per share. Shares were originally sold for $25.00 each and have a net asset value per share of $20.26 as of June 30, 2017.”
Mark Kolta Customer Complaints
Mark Kolta has been the subject of 12 customer complaints between 2010 and 2018, five of which were denied and three were closed without action, according to his CRD report:
- June 2018. “Misrepresentations, unsuitable recommendations, breach of fiduciary duty, breach of contract & negligence.” The customer is seeking $450,000 in damages and the case is currently pending.
- August 2015. “Failure to follow instructions.” The case was settled for $4,999.
- January 2015. “Suitability.” The case was settled for $44,000.
- June 2010. “Client alleges unauthorized trading regarding a managed account. Activity dates are 03/26/2010-03/26/2010.” The customer sought $5,000 in damages and the case was settled for $200.
Pursuant to FINRA Rules, member firms are responsible for supervising a broker’s activities during the time the broker is registered with the firm. Therefore, National Securities Corporation may be liable for investment or other losses suffered by Mark Kolta’s customers.
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.