The Securities and Exchange Commission (“SEC”) announced in April 2013 that it obtained federal court judgments totaling more than $5 million against Michael Bozora, Timothy Redpath, Capital Solutions Distributors, LLC (CSD) and Capital Solutions Management, LP (CSM). The SEC’s case against the defendants alleged that Bozora and Redpath, who owned and controlled CSD, the distributor of the Capital Solutions Monthly Income Fund, and CSM, the Fund’s investment adviser, made misleading written and oral representations to Capital Solutions Monthly Income Fund investors. Specifically, they claimed the Fund was performing well during as the credit and real estate markets were suffering badly. But investors were not told that the Fund’s sole borrower had defaulted. Many investors have valid FINRA arbitrations claims against the brokerage firms that sold the Capital Solutions fund, claiming, among other things, that the brokerage firms failed to conduct adequate due diligence on the Fund and that the Fund was unsuitably risky for certain investors.
