(The Center Square) – Investors who bought retail precious metals from California-based Lear Capital can receive compensation from Lear’s bankruptcy plan, the Oregon Division of Financial Regulation announced this week.
State securities regulators have investigated Lear for deceptive securities and commodities activities, plus misleading marketing practices.
Lear will dole out $5.5 million of its precious metals under the bankruptcy plan. Investors who file a bankruptcy plan will get refunds based on calculations from Lear’s bankruptcy plan. Additionally, Lear will offer a pro rata distribution of any remaining funds to investors who do not file claims.
The pro rata distribution applies to those who bought precious metals from Lear between January 1, 2016, and March 3, 2022.
The company agreed to improve its sales practices and disclosures as a part of its bankruptcy plan.
It agreed to “not misrepresent its fee, not offer portfolio assessments of securities holdings, not hold itself out as an investment adviser in any way, and not provide investment advice or commit securities or commodities fraud,” according to the release.
“We are always on the lookout for businesses that use deceptive tactics to take advantage of investors,” TK Keen, administrator for DFR, said.
“Lear Capital got people to invest hard-earned money without proper fee disclosures and racked up millions of dollars at the expense of investors. Our division is committed to holding companies accountable that breach the trust of their customers.”
Before the bankruptcy settlement, several regulators alleged the Los Angeles-based company used deceptive business practices, violating investor protection laws. It resolved these issues as a part of its $5.5 million bankruptcy settlement.
