Investor Alerts Investor Rights Top 10 Investment Scams Commentary
Types of Stock Broker Misconduct State Securities Departments Arbitration

Contact Information
Law Offices of Eric Norstedt, P.A.
2924 Davie Road, Suite #200
Davie, Florida, 33314
P: (954) 467-6263

F: (954) 467-6159

Contact Form

Driving Directions

Securities Law
 - Securities Act of 1933
 - Securities Act of 1934
    - Rules Promulgated under
      the Securities Act of 1934


Alabama Securities Law
Alaska Securities Law
Arizona Securities Law
Arkansas Securities Law
California Securities Law
Colorado Securities Law
Connecticut Securities Law
Delaware Securities Law
Dis. of Columbia Securities Law
Florida Securities Law
Georgia Securities Law
Hawaii Securities Law
Idaho Securities Law
Illinois Securities Law
Indiana Securities Law
Iowa Securities Law
Kansas Securities Law
Kentucky Securities Law
Louisiana Securities Law
Maine Securities Law
Maryland Securities Law
Massachusetts Securities Law
Michigan Securities Law
Minnesota Securities Law
Mississippi Securities Law
Missouri Securities Law
Montana Securities Law
Nebraska Securities Law
Nevada Securities Law
New Hampshire Securities Law
New Jersey Securities Law
New Mexico Securities Law
New York Securities Law
North Carolina Securities Law
North Dakota Securities Law
Ohio Securities Law
Oklahoma Securities Law
Oregon Securities Law
Pennsylvania Securities Law
Puerto Rico Securities Law
Puerto Rico Seguridades Ley
Rhode Island Securities Law
South Carolina Securities Law
South Dakota Securities Law
Tennessee Securities Law
Texas Securities Law
Utah Securities Law
Vermont Securities Law
Virginia Securities Law
Washington Securities Law
West Virginia Securities Law
Wisconsin Securities Law
Wyoming Securities Law

  NFP Securities, Hennessey Fund, Capital Solutions Monthly Income Fund


The Law Office of Eric Norstedt, P.A. and the Law Firm of Vernon Healy have filed an arbitration claim against NFP Securities, Inc. for the inappropriate sale of the Hennessey Financial Monthly Income Fund LP, now known as Capital Solutions Monthly Income Fund, LP. The claim was filed after a federal court denied "Hennessey Fund" or "Capital Solutions" Motion for summary judgment in a case brought by the Securities and Exchange Commission for alleged securities fraud committed by the Fund.

According to the Claim filed last week, the client approached NFP Securities to invest the bulk of her net worth in conservative investments.  The Florida investor informed the NFP financial advisor that she had limited understanding of the stock market and wanted to make sure any recommended investments were low risk.  Nevertheless, NFP Securities placed the investor's savings in high risk alternative investments, one of them being the Hennessey Financial Monthly Income Fund LP.

The Claim states that NFP Securities assured the client that she would receive a good dividend on the Hennessey Fund (i.e., Capital Solutions) investment.  The Claim also states that the NFP Securities financial advisor indicated that he had thoroughly researched and conducted due diligence on the Hennessey Fund; that he was personally familiar with the individuals who managed the Hennessey Fund; and that investors would receive their principal back when the Hennessey Fund would liquidate years later.

Soon after NFP Securities sold the Hennessey Fund to the investor, the Fund initially began paying the distribution that NFP Securities had promised.  However, the Fund subsequently cut its distributions in half, and by November of 2009, the Hennessey Fund suspended all distributions permanently. The Claim asserts that, contrary to what the Florida investor was told about the Hennessey Fund, NFP Securities knew or should have known that the Fund was already experiencing severe financial difficulties by the time it was sold to investors.  Regrettably, the Claim (which alleges damages not in excess of $499,000) indicates that the Hennessey Fund (i.e., Capital Solutions) may now be virtually worthless, decimating the investor's savings.  As stated above, the Hennessey Fund is now being pursued as a fraudulent investment by the SEC.

According to a federal court opinion in the SEC fraud case against the Hennessey Fund/Capital Solutions, NFP Securities did not conduct adequate independent due diligence report on the Hennessey Fund (i.e., Capital Solutions) until December of 2008 (which was several months after NFP Securities had sold the Hennessey Fund investment to the Florida investor).  The Court opinion highlights that NFP Securities did not forbid its brokers from continuing to recommend the Hennessey Fund to their investors. 

"It is apparent that in making the Hennessey Fund recommendation NFP Securities failed to provide investors with a fair and balanced assessment of this investment," said Chris Vernon, a securities fraud lawyer and founding partner at Vernon Healy.  According to Eric Norstedt, also a securities fraud lawyer, NFP Securities' questionable business practices were evident in this case. "NFP's failure to perform the proper due diligence on the Hennessey Fund prior to recommending it to investors is not only troubling, but a disturbing breach of its duty to our client."

According to an investigation conducted by the attorneys, it appears that NFP Securities may have been the only broker dealer that ever offered the Hennessey Fund to investors around the country.  The investigation has also revealed that the Hennessey Fund/Capital Solutions was a complicated and speculative investment.  It appears that the Hennessey Fund's investment strategy was to loan money to a third-party mezzanine real estate lender (at annual rates of 18% or greater), which, in turn, enabled the lender to make loans to real estate developer companies.  Both the third-party mezzanine lender and the real estate developer companies were owned by the same person. According to the Claim, NFP Securities was aware of this structure.     

The legal team of Vernon Healy and the Law Office of Eric Norstedt continue to represent investors across the country who have suffered considerable losses from their investment in alternative investments such as the Hennessey Financial Monthly Income Fund LP, now known as Capital Solutions Monthly Income Fund, LP. If you are concerned about your investments with NFP Securities and the circumstances under which any of the investments were offered and sold to you, please call toll free either Eric Norstedt, P.A. at 1-866-537-6891 or Vernon Healy toll-free at 1-877-649-5394 or by e-mail at en@enpalaw.com or info@vernonhealy.com






Home - About Us - Contact Us - Investor Alerts - Investor Rights - Top 10 Investment Scams - Commentary Blog
Types of Stock Broker misconduct
- State Securities Departments - Arbitration Process - Sitemap - Other Lawyer Resources

The hiring of a lawyer is an important decision that should not be based solely upon advertisements. Before you decide, ask us to send you free written information about our qualifications and experience.. This web site is designed for general information only. The information presented at this site should not be construed to be formal legal advice nor the formation of a lawyer/client relationship. This firm is not responsible nor does it vouch for the information contained on any links.

Site by Purpose Web Design, Clearwater, FL


© 2008 | All Rights Reserved | United States Investor Law.