Posted Nov 17, 2020 by Alan Rosca
March 19, 2021 Update: Vida investors represented by GSP securities lawyers and co-counsel have filed class action lawsuit. Visit the Vida Longevity Investor Center for more details and case investigation updates.
Goldman Scarlato & Penny P.C. law firm is investigating potential unsuitability, broker misconduct, misrepresentation, and security law violations claims related to the sale of investments in Vida Longevity Fund, LP (VLF). The VLF, an open-ended investment fund, reportedly promised investors the ability to obtain a liquid profit quarterly and an annualized return of 10-14% despite high risk and unsuitability.
Vida Longevity might have appealed to many investors as it was offering a risk management plan that reportedly included personalized policies based on age, carrier, and primary impairments, but recent reports published online alleged that market indicators show a significant deviation from what the fund initially offered and what it delivered to the investor.
If you are concerned you may have suffered significant losses from investing in Vida Longevity Fund, LP, you might be entitled to pursue an investment recovery case against the brokerage firm that sold you this investment, and potentially other entities.
Our experienced securities lawyers are looking into potential claims on behalf of Vida Longevity Fund investors against the investment advisory firms that may have made misrepresentations and omissions when soliciting investors to buy into the Vida Longevity Fund. Investors may have been sold this investment even though it was unsuitable for their portfolio, risk tolerance level, or investment goals. If you are a VLF investor and you believe you have sustained losses, you should consider evaluating your legal options. Contact Goldman Scarlato & Penny investor rights attorney Alan Rosca or his colleagues at 888-998-0530, via email at firstname.lastname@example.org, or fill out the contact form on this webpage.
About The Vida Longevity Fund
The Vida Longevity Fund was launched in 2010 by Vida Capital, a multi-billion dollar alternative asset management company, founded in 2009 based in Austin, Texas, specializing in insurance-linked strategies with a primary focus on longevity contingent risk, according to the Vida Capital website. Longevity contingent assets include life settlements, synthetic products annuities, notes, and structured settlements.
The Vida Longevity Fund, LP is a Delaware limited partnership formed specifically to invest in senior life settlements and other longevity contingent assets. VLF is structured as an open-ended hedge fund that promises to offer investors the ability to receive quarterly cash payments. The fund also claimed to focus on capital preservation and reportedly targeted 10-14% in annual investment returns that are largely uncorrelated to other asset classes.
The fund reportedly offers three shares classes, A, B, and C. To invest in Class A Shares, investors are reportedly expected to purchase at least $510,000 in shares, while Class B and Class C shares require a $225,000 minimum investment. As reported by Vida Capital, the Vida Longevity Fund carries significant fees with investments; Class A Shares carry at 5% incentive fee and 2% management fee, Class B Shares carry a 10% incentive fee and 1.5% management fee, Class C Shares carry up to a 15% incentive fee and 1.75% management fee.
The Vida Longevity Fund sales commissions might have acted as a motivating factor for any unscrupulous broker-dealers and financial advisors to sell private placements regardless of whether the investments match the client’s investment objectives and profile.
Generally speaking, a private placement is a non-public offering used to raise capital. Private placements allow companies to raise an unlimited amount of money and sell securities to accredited investors. Accredited investors typically include:
- individuals with a net worth over $1 million (either alone or together with a spouse),
- individuals who earn an income that exceeds $200,000 (or $300,000 together with a spouse),
- any trust with total assets that exceed $5 million,
- or an entity in which all equity owners are accredited investors.
Private placements are not considered a public offering, therefore they are exempt under Regulation D of the Securities Act from SEC Registration. Nonetheless, these investments cannot be readily sold and they are not traded on the open market. The potential problems with private placements include lack of transparency, inaccessibility of assets or securities without substantial loss in value (illiquidity), lack of regulatory oversight, and higher risk of investment fraud. All these are general considerations and not legal advice for any individual investor. Vida Longevity Fund Investors looking for legal advice may contact Goldman Scarlato & Penny attorney Alan Rosca or his colleagues for a discussion of their situation and options.
Securities lawyer Alan Rosca and his colleagues at Goldman Scarlato & Penny P.C. law firm have been investigating potential claims on behalf of Vida Longevity Fund investors, and are preparing to take action to seek compensation for investors who believe they suffered losses. VLF investors may contact attorney Alan Rosca or his colleagues for a free, no obligation evaluation of their recovery options at 888-998-0530, via email email@example.com, or fill out the contact form on this webpage.
The Risks of Alternative Investments Like VLF
Alternative investments may seek to accomplish the issuing company’s objectives through non-traditional investments and trading strategies. These trading strategies are often complex, risky but also potentially tempting to investors because they offer special features and higher returns compared to basic investments. Alternative investments are typically considered to be any investment made in asset classes other than stocks, bonds, and cash. Due to the complexity of alternative investments, they often have higher fees associated with them. These fees can be as high as 2% of the assets and 20% of all the cumulative profits. Complex products used by alternative investments include notes with principal protections and high-yield bonds that have lower credit ratings and higher risk of default, but offer more attractive rates of return, according to FINRA.
Alternative investments are illiquid, therefore the money an investor commits is usually inaccessible for at least a period of time, and typically cannot be readily sold or exchanged for cash without a substantial loss in value. Illiquid assets may be hard to sell quickly in relation to low trading activity due to lack of willing investors to purchase or sell the asset. Due to the high risk and complexity of alternative investments, they are typically limited to accredited investors only. Less regulation of alternative investments calls for less investor protection from possible fraud, nonetheless, these investments put more investors at risk for loss.
Investors who were recommended Vida Longevity Fund investments by their brokers are encouraged to contact an attorney at Goldman Scarlato & Penny for a free case evaluation. Many investors might have been unsuitable for most VLF investments, and unaware of the risks involved with the investment. Vida Longevity Fund investors may contact an experienced securities lawyer today to discuss recovery options, call 888-998-0530 or via email firstname.lastname@example.org .
The Potential Problems with Vida Longevity Fund Investments
Generally, broker-dealers may potentially put customers at risk when they fail to perform adequate due diligence on any investment recommendation, or when they sell unsuitable investments to their customers. In particular to alternative investments such as The Vida Longevity Fund, it is especially important for broker-dealers to perform due diligence when recommending high-risk, complex investments that are not registered with the SEC, and investments that are offered via private placement. The Vida Longevity Fund offers investments in longevity-contingent assets such as life insurance, so if the broker-dealer does not conduct adequate due diligence, there may be liability for substantial losses. If this sounds familiar to you, you are encouraged to contact Goldman Scarlato & Penny attorney Alan Rosca at 888-998-0530 to discuss recovery options in order to evaluate potential claims against entities including the brokerage firm or advisory firm that sold you the investment.
VLF broker-dealers may have recommended for customers to purchase investments through Vida Longevity without adequately disclosing risks. Many of such brokers and financial advisors may have failed to consider the customer’s investment goals, risk tolerances, and financial needs. Unfortunately, this sometimes may happen due to motivation to obtain high commissions and high returns.
According to publicly available reports, Vida Longevity Fund investors may have purchased investments through the Fund due to misrepresentation, omission of information, and in circumstances that made such purchases unsuitable. Due to the high risk involved with investment products such as VLF, Vida Longevity investments are may be unsuitable for a large number of investors . Reports recently published online indicate that the Fund has experienced negative asset valuations, suggesting that the investment might not be as valuable as allegedly portrayed by some investment advisers.
As of October 28, 2020, Vida Longevity has announced changes in their management and the undertaking of its portfolio management and underwriting practices. In April 2020, Vida Longevity also made changes to its valuation procedures. These recent announcements raised questions among VLF investors about Vida Longevity’s business practices and what led to these changes.
Finally, it is important to note that, as of the date of this article, there has not been a finding of liability as to the complaints mentioned in this article, unless otherwise indicated. No allegation of misconduct is being made as to Vida Longevity or its principals.
Options For Vida Longevity Fund Investors
Securities lawyer Alan Rosca, along with his team at Goldman Scarlato & Penny, have started investigating this matter. Their main focus is on broker-dealers and financial advisors that recommended and sold VLF investments to their customers without conducting adequate due diligence and promising customer high returns. Broker dealers and financial advisors typically have a duty to conduct adequate due diligence prior to recommending securities to potential investors.
If you have invested in VLF, please contact Goldman Scarlato & Penny to learn about your rights and/or for a free case evaluation and portfolio review. All consultations are free. The Goldman Scarlato & Penny attorneys typically take cases like this on a contingency fee basis, advance all case costs, and only get paid for their fees and expenses, when they recover money for their clients. If there is no recovery, no fees or expenses are charged.
The Goldman Scarlato & Penny lawyers have extensive experience in evaluating investment portfolios in order to determine if there are signs of misconduct. Investors who are concerned they may have lost money with Vida Longevity Fund may contact attorney Alan Rosca or his colleagues at 888-998-0530, via email email@example.com, or through the contact form on this webpage.
In our legal system, every person is innocent until and unless found guilty by a court of law or a tribunal. Whenever we reference “allegations” or charges that are “alleged,” such allegations or charges have not been proven, and are merely accusations, not findings of fault, as of the date of the blog. We do not have, nor do we undertake, a duty to continue to monitor or follow cases about which we report, and/or to publish subsequent updates regarding various developments that may occur in such cases. Readers are encouraged to conduct their own research regarding any such cases and any developments that may or may not have occurred in such cases. Also, the brokercheck report linked to some of our blogs is the up-to-date version as of the date of accessing. Visitors may check the most recent version of each brokercheck report at www.finra.org.