A large broker-dealer agreed to pay up to $2 Million in restitution and a $500,000 fine in connection with violating prospectus and compliance manual restrictions in the sale of non-traded REITs.  The Massachusetts Securities Division alleges that the respondent allowed the sale of non-traded REITs beyond prospectus and compliance manual restrictions that limited sales to those over 70.  The MSD claims that the firm did not do adequate training to sensitize sales personnel to the prospectus limitations that applied to Massachusetts residents.

OUR TAKE: Firms must be mindful of product-specific limitations contained in offering documents and within their own internal procedures.