Massachusetts securities division examining independent broker-dealers that sold RCS alternative investments such as nontraded REITs.
It is the second large group of wholesalers to migrate to another firm en masse from the defunct Realty Capital Securities, a unit of RCS Capital Corp.
RCS Capital intends to make another round of bankruptcy filings that will include broker-dealer holding companies of its Cetera Financial Group firms.
Forty advisers from the Legend Equities Corp. are joining a firm that specializes in retirement plans for schools and other nonprofits.
The agency's final reg will allow the asset class to be sold after all.
In complaint, regulator says that almost 95% of VFG Securities' revenues were generated from nontraded REITs and other direct participation programs. B-D owner claims he is the victim of “character assassination."
The firm could create its own REIT sponsor and wholesaler or take a run at an established one like NorthStar Asset Management Group Inc.
Source says firm eyes creating, managing nontraded REITs for brokers and advisers to sell.
RCS was recently closed after paying Massachusetts $3 million to settle charges that it fraudulently rounded up proxy votes for real estate deals.
Firm agreed to leave more than 40 senior staffers alone until September or until RCS Capital's bankruptcy plan becomes effective.
