Earlier this week, the Financial Industry Regulatory Authority Inc. (“FINRA”) ordered David Lerner Associates Inc. (“David Lerner”), a Long Island based broker-dealer whose business was largely based on the sale of municipal bonds and Real Estate Investment Trusts (“REITs”), to pay over $12 million in restitution to customers who purchased Apple REIT 10, as well as $2.3 million in fines for charging unfair prices. According to FINRA spokeswomen, Michelle Ong, this is the largest restitution payment for REIT investors. See October 2012 Press Release here. In May 2011, FINRA filed a complaint against David Lerner alleging that the firm solicited thousands of customers and sold the illiquid Apple REIT 10, a non-traded $2 billion REIT, without first performing adequate due diligence to determine whether the investment would be suitable. See May 2011 Press Release here. David Lerner allegedly recommended and sold more than $442 million Apple REIT 10 products by targeting unsophisticated and elderly investors through the use of misleading marketing materials and performance results. Id. David Lerner, the firm’s founder and chief executive officer, was fined $250,000 and was suspended from the securities industry for one (1) year, as well as from acting as the firm’s principal for two (2) years after the completion of his industry. Lerner was also fined $250,000. Additionally, William Mason, David Lerner’s head trader, was fined $200,000 and has been suspended for six (6) months from practice in the industry for his role in the condemned practices. See Broker CRD here. It was also noted in this statement that David Lerner neither admitted nor denied the charges around the sale of the products but, rather, consented to the entry of FINRA’s findings. If you have suffered losses from investments with David Lerner Associates Inc., or any other investment adviser firm or brokerage firm, and believe that you are a victim of sales practice abuses, please contact Lax & Neville LLP for a consultation at (212) 696-1999. Our firm has extensive experience and knowledge representing victims of investment fraud nationwide.