The Death of a Brokerage Firm

I’m not going to rehash my thoughts on non-traded REITs here because I’ve already beaten that dead horse back to life and then into death again. Several times. Suffice it to say, I’ve been calling them poisonous for almost a decade at this point.

One of the largest purveyors of non-traded REITs (and the salespeople who sell them) has just filed for bankruptcy protection. I watched as this firm began rolling up small broker-dealers, some of which I knew to be notorious boiler rooms from my prior career in the retail brokerage wild west. Once that began, I guessed it wouldn’t be long before the whole thing would blow up. If you’re going to sell a subpar product with an obscenely high commission, you’re going to need some serious mercenaries on your salesforce. And with salespeople like that, trouble can’t be far behind.

And that’s exactly what has happened.

One of the strangest twists in this story is that many of the firm’s decent advisors and brokers also got caught up in the storm. When the firm went down, some of its employees were among the shareholders holding the bag.

“If you’re asking me as a stockholder, I feel lied to, used and taken advantage of,” said the Cetera adviser, who bought RCAP shares under the stock warrant program. “I’m taking my life’s work and starting over again,” said the adviser, who asked not to be identified but said that he had invested a six-figure amount in RCAP shares.

I would tell you to read Bruce Kelly’s profile of this brokerage firm’s aftermath at Investment News right now to understand what’s happened.

Questions burn for shareholders after RCAP’s demise (Investment News)

This content, which contains security-related opinions and/or information, is provided for informational purposes only and should not be relied upon in any manner as professional advice, or an endorsement of any practices, products or services. There can be no guarantees or assurances that the views expressed here will be applicable for any particular facts or circumstances, and should not be relied upon in any manner. You should consult your own advisers as to legal, business, tax, and other related matters concerning any investment.

The commentary in this “post” (including any related blog, podcasts, videos, and social media) reflects the personal opinions, viewpoints, and analyses of the Ritholtz Wealth Management employees providing such comments, and should not be regarded the views of Ritholtz Wealth Management LLC. or its respective affiliates or as a description of advisory services provided by Ritholtz Wealth Management or performance returns of any Ritholtz Wealth Management Investments client.

References to any securities or digital assets, or performance data, are for illustrative purposes only and do not constitute an investment recommendation or offer to provide investment advisory services. Charts and graphs provided within are for informational purposes solely and should not be relied upon when making any investment decision. Past performance is not indicative of future results. The content speaks only as of the date indicated. Any projections, estimates, forecasts, targets, prospects, and/or opinions expressed in these materials are subject to change without notice and may differ or be contrary to opinions expressed by others.

Wealthcast Media, an affiliate of Ritholtz Wealth Management, receives payment from various entities for advertisements in affiliated podcasts, blogs and emails. Inclusion of such advertisements does not constitute or imply endorsement, sponsorship or recommendation thereof, or any affiliation therewith, by the Content Creator or by Ritholtz Wealth Management or any of its employees. Investments in securities involve the risk of loss. For additional advertisement disclaimers see here:

Please see disclosures here.

What's been said:

Discussions found on the web
  1. w88 commented on Sep 20

    … [Trackback]

    […] Find More on on that Topic: […]

  2. kid commented on Sep 25

    … [Trackback]

    […] Find More Info here to that Topic: […]

  3. bitcoin era commented on Oct 01

    … [Trackback]

    […] Find More on that Topic: […]

  4. commented on Oct 03

    … [Trackback]

    […] Read More here to that Topic: […]

  5. dumps shopping commented on Oct 23

    … [Trackback]

    […] Read More Info here to that Topic: […]

  6. Harold Jahn Alberta commented on Nov 13

    … [Trackback]

    […] Read More on on that Topic: […]

  7. hotel search commented on Nov 22

    … [Trackback]

    […] Find More on on that Topic: […]

  8. 19올넷 commented on Nov 29

    … [Trackback]

    […] Find More on to that Topic: […]

  9. commented on Dec 06

    … [Trackback]

    […] There you can find 72787 additional Info on that Topic: […]