Securities Arbitration Lawyers BlogNorthstar Financial Services (Bermuda) Investment Loss Attorneys
Silver Law Group represents Northstar Financial Services (Bermuda) investors and has filed arbitration claims against brokerage firms that improperly sold Northstar products to investors. Silver Law Group’s clients allege that the selling firms pitched Northstar as a safe, conservative investment that was comparable to bank certificates of deposit (CDs), and that financial advisors represented that Northstar was guaranteed to provide monthly interest and protection of principal.
Unfortunately, Northstar is currently undergoing liquidation proceedings in Bermuda, similar to a bankruptcy. It is unknown exactly how much investors will receive from the Joint Provisional Liquidation, but it is likely that investors will suffer large losses.
Background On Northstar Financial Services (Bermuda) Ltd.
Northstar offered investment and annuity-type products to investors located outside the United States. The company was based in Bermuda and claimed to offer various benefits, including tax shelters, not available to US-based investors. Northstar relied on a network of financial advisors across the United States and abroad to sell its products to investors. Firms that sold Northstar include Suntrust Investment Services, Ocean Financial Services, Bankoh Investment Services, and Cetera Investment Services.
In mid-2018, Northstar was sold to a Bermuda holding company owned by now-convicted fraudster Greg Lindberg. As early as 2019, the US Department of Justice began investigating Lindberg, who was subsequently indicted and in March 2020, convicted. As details about Lindberg’s financial dealings came to light, questions about Northstar’s financials arose, leading to the company spiraling into insolvency proceedings in Bermuda court.
Northstar was one of hundreds of investment and insurance companies Lindberg purchased and incorporated into his conglomerate, Global Growth, formerly known as Eli Global. Bermuda court documents indicate that soon after Lindberg purchased Northstar Financial Services, he “reallocated the assets . . . many in special purpose vehicle structures, under the control of Mr. Lindberg, in the US.” Essentially, Lindberg moved Northstar’s holdings into other companies he owned, funneling funds to himself and attempting to increase his net worth.
As a result of Northstar’s decline, the company was unable to meet obligations to investors, who increasingly sought to liquidate their investments and surrender their policies. Bermuda court documents indicate that as of September 2020, more than $70 million was owed to investors, while Northstar only has approximately $8 million in cash on hand.
Northstar investors may have claims against the selling brokerage firm and/or financial adviser.
Northstar was a complex, risky, and speculative investment product. Financial advisers are obligated to investigate and understand the nature of the products they sell to their customers, as well as to adequately disclose the features of the investment to their customers, especially the risks. This is particularly true where a investor stood to lose their entire investment.
Northstar Financial Services (Bermuda) offered a wide variety of investment products, including:
- Global Interest Accumulator
- Global Advantage Plus Series
- Global Advantage Select
- Global VIP Elite
- Global Index Product
If you or someone you know experienced losses investing in a Northstar Financial Services (Bermuda) product, contact Silver Law Group for a confidential consultation toll free at (800) 975-4345 or email ssilver@silverlaw.