Attorney David Neuman Announces Probe Into Sales Practices of Brokerage Firms Who Sold Desert Capital REITs

CHICAGO, Aug. 9, 2011 (GLOBE NEWSWIRE) — Attorney David Neuman announces the launch of an investigation into brokerage firms for sales practices of the Desert Capital Real Estate Investment Trust (“REIT”). The Desert Capital REIT is a non-traded real estate investment trust launched in 2004. The non-traded REIT was designed to finance short term, high interest rate mortgage loans secured by real estate and to pay dividends back to investors. These hard-money loans are of a high risk nature but could earn as much as 13.2% annual interest.

The purchasers of the Desert Capital REITs sustained almost a complete loss.�The REITs lost million in 2007, million in 2009, and another million in the third quarter of 2010 alone. Desert Capital published a press release announcing it has “doubt as to [its] ability to continue” and may have to be liquidated.

Shares in the REIT are not traded on any exchange, leaving investors, many of whom are elderly or retired, with non-dividend paying, illiquid investments that are essentially worthless. In June of 2011, Desert Capital�withdrew its objection to involuntary bankruptcy. The Henderson-based company will continue operations while the bankruptcy case proceeds under Chapter 11. The Securities and Exchange Commission has issued a subpoena to Desert Capital “pertaining to payments and transactions with [its] related party, CM Capital.”

According to Attorney David Neuman: “We are investigating the sales practices of brokerage firms who sold Desert Capital REITs.�Unfortunately, the REITs were pitched to some clients as a relatively safe and secure investment, appropriate for those who were elderly, retired or otherwise looking for a ’safe’ return.�We believe these representations have been categorically false.�In addition, we believe brokerage firms failed to do the due diligence required of them prior to recommending the REITs to clients.�We are not naming the financial advisors who recommended the REITs but are only targeting the brokerage firms who sold them.�Burned investors can use the FINRA arbitration process to recover some, or all, of their investment losses in the Desert Capital REITs on a contingency fee basis.”


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To learn more, please contact attorney David Neuman at 312.332.4200 or visit www.InvestmentFraud.PRO

CONTACT: David Neuman Esq.
         o: 312-332-4200
         10 S. LaSalle, 35th Floor
         Chicago, IL 60603
         www.InvestmentFraud.PRO

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