Securities America’s Medical Capital Notes “Nightmare” Continues


According to a recent article in InvestmentNews, Securities America faces 150 or so arbitration claims seeking recovery of $90 million of investor losses associated with its sale of Medical Capital Notes. The claims are shaping up to be a significant problem for Securities America and its parent company Ameriprise Financial, Inc. On New Year’s Eve, Securities America was hit with a 1.2 million dollar award in connection with its sale of the Medical Capital Notes. The award included $734,000 in compensatory damages, $250,000 in punitive damages and $171,000 in attorney and expert fees.

According to attorney Pratt H. Davis at Page Perry, a securities litigation firm currently representing over 20 Securities America clients, “we are excited about the prospects of Medical Capital Note claims. Based on the number of cases pending as reported by InvestmentNews, it appears that we have approximately 10% of the claims filed. Moreover, the award of punitive damages by a FINRA panel is a foreboding sign for Securities America and other sellers of Medical Capital notes going forward as punitive damages are rarely awarded in FINRA arbitrations.”

Mr. Davis believes that Securities America appears to recognize the problem it is facing if the claims proceed to a final hearing as Securities America is reportedly beginning to quietly settle other Medical Capital arbitration cases. Along with claims filed by individual investors, Securities America also faces regulatory actions from Massachusetts and Montana. The collapse of the Medical Capital investments has left investors nationwide in the hole to the tune of about $1 billion.

Investors who have lost money in Medical Capital Notes need to be active about pursuing their recovery options. Page Perry is an Atlanta-based law firm with over 125 years collective experience representing investors in securities-related litigation and arbitration. While past results are not indicative of future success, Page Perry’s attorneys have recovered over $1,000,000 for clients on more than 40 occasions. Page Perry’s attorneys are actively involved in representing institutional and corporate investors in securities cases across the country. For further information, please contact us.