Firms file additional claims

NAPLES — In a claim filed last week, two law firms allege that former VSR Financial Services adviser Paul Larsen deceptively sold non-traded REITs and other alternative investments to his clients.

The transactions constitute fraud, a breach of fiduciary duty and a violation to the Florida Securities Act, argue attorneys from Vernon Healy and Dovin Malkin and Ficken, who filed the claim.

According to a release from the law firms, Larsen met with a retired couple in Fort Myers who gave him the bulk of their retirement nest egg to invest in low-risk, income-producing investments. Larsen invested their money into non-traded REITs, including the KBS REIT I and Inland Western REIT, which have since lost about 30% to 50% of their value. These REITs have also suspended or reduced their distribution payments.

The claim says VSR Financial Services failed to supervise the Naples broker, whom they allege misrepresented the details of the investments to the retirees.

“Sadly, this type of behavior occurs regularly,” securities attorney Chris Vernon says in a release. “A broker befriends potential clients, wins their trust, even goes (and) visits them at their home, and then places them into unsuitable risky and highly illiquid investments that pay high commissions.”

The claim seeks redress of more than $200,000 for the retirees. Overland Park, Kan.-based VSR Financial Services did not immediately return calls for comment.