Our firm is investigating Cetera Investment Services broker and Cetera Investment Advisers investment advisor representative Gihan Anil Fernando (CRD# 4469669) of Houston, Texas for potential investment-related misconduct involving non-traded real estate investment trusts (REITs) and other real estate securities.
Financial Advisor’s Career History
According to FINRA BrokerCheck, Gihan Anil Fernando has worked in the securities industry since 2002 and is currently dually registered as both a broker and investment adviser representative in Texas.
Fernando is presently associated with:
- Cetera Investment Advisers LLC (CRD# 105644) as an Investment Adviser Representative, registered since July 2, 2024, with a branch office at 5433 Westheimer Road, Suite 800, Houston, Texas 77056.
- Cetera Investment Services LLC (CRD# 15340) as a General Securities Representative and Texas agent, registered since January 12, 2024, also listing the Houston, Texas branch at 5433 Westheimer Road, Suite 800.
His prior registration and employment history includes:
- BOK Financial Advisors (CRD# 17530) in Bellaire, Texas, as an investment adviser representative from March 2003 to November 2023.
- BOK Financial Securities, Inc. (CRD# 17530) in Bellaire, Texas, as a broker from March 2003 to November 2023, where he held senior roles including Senior Vice President and Senior Financial Advisor.
- Morgan Stanley and Morgan Stanley DW Inc. (CRD# 7556) in Houston, Texas and Purchase, New York, where he was registered between 2002 and early 2003.
Over more than two decades, Fernando’s practice has focused on retail investors, many of whom were introduced to complex and illiquid real estate securities, including non-traded REITs.
Gihan Anil Fernando Fraud Allegations and Investor Complaints Explained
FINRA BrokerCheck currently reports one final regulatory event and seventy-two customer disputes involving Gihan Anil Fernando. All of the customer disputes are described as “Customer Dispute – Settled,” with no pending or on-appeal matters. The disclosures overwhelmingly involve real estate securities and non-traded REIT products sold while Fernando was at BOK Financial Securities, Inc.
Texas Regulatory Reprimand Over Non-Traded REIT Recommendations
In a July 2, 2024 order, the Texas State Securities Board (TSSB) issued a reprimand against Fernando in connection with his recommendations of non-traded REITs. According to the regulatory disclosure:
- The action was initiated by the Texas State Securities Board under docket/case number REG-24-CAF-05.
- The order states that Fernando recommended clients purchase REITs without fully understanding the product. Regulators characterized this as an “inequitable practice” in the sale of securities while rendering investment advisory services, citing Section 4007.105(a)(a)(A) of the Texas Securities Act.
- The matter was resolved through an order of reprimand, with a “final” status and a sanction in the form of a letter of reprimand. There is no indication in BrokerCheck that the order was based on fraud-based violations (the report indicates “No” to whether the order is based on laws prohibiting fraudulent or deceptive conduct).
This regulatory action underscores the heightened concerns state regulators have with non-traded REITs, particularly when brokers do not fully understand critical features such as liquidity constraints, valuation practices, risk factors, or distribution sustainability before recommending them to retail customers.
Wave of Real Estate Security and Non-Traded REIT Customer Complaints
BrokerCheck shows seventy-two settled customer disputes, almost all involving “Real Estate Security” products—an umbrella category that frequently includes non-traded REITs and similar real estate-linked investments.
Common themes across the complaints include allegations that:
- Certain features of the products were misrepresented during the sales process.
- The investments were unsuitable for the customers’ objectives and risk tolerance.
- Investors were not adequately warned about illiquidity, potential suspension of redemptions, or changes in distributions.
- Losses or inability to access principal occurred after market or issuer-specific stress, leading to complaints and FINRA arbitrations.
In many cases, the alleged compensatory damages equal the customer’s original principal invested in the product, with individual alleged damage amounts ranging from approximately $50,000 to $500,000 per complaint.
Examples of Settled REIT and Real Estate Security Complaints
The BrokerCheck report provides detailed examples of settled disputes, including the following:
- Disclosure 1 of 70 (FINRA Arbitration – 2015–2017 Sales)
- Product: Real Estate Security (non-traded REIT-type investment).
- Allegations: Misrepresentation and unsuitable advice in connection with sales on or around October 2015 through January 2017 while at BOK Financial Securities, Inc.
- Alleged Damages: $500,000.00.
- Procedure: FINRA Dispute Resolution arbitration, case number 25-01553.
- Outcome: Settled on October 14, 2025 for $164,380.55, with $0 individual contribution reported for Fernando.
- Disclosure 2 of 70 (2015 Sale – Misrepresentation of Product Features)
- Product: Real Estate Security.
- Allegations: Complainant alleges that certain features of the product were misrepresented during the May 2015 sales process.
- Alleged Damages: $250,000.00.
- Outcome: Written complaint; settled July 3, 2025 for $243,369.26; $0 individual contribution.
- Disclosure 3 of 70 (2016 Sale – Principal-Loss Complaint)
- Product: Real Estate Security.
- Allegations: Misrepresentation of product features during an August 2016 sale.
- Alleged Damages: $50,000.00, equal to the customer’s original principal investment.
- Outcome: Settled on November 21, 2024 for $40,903.18, with no contribution by Fernando.
- Disclosure 4 of 70 (2017 Sale – Illiquid Real Estate Investment)
- Product: Real Estate Security.
- Allegations: Misrepresentation of certain product features during an October 2017 sale.
- Alleged Damages: $200,000.00, again tied to the original principal invested.
- Outcome: Settled December 17, 2024 for $71,873.45, with $0 individual contribution.
These are only a few of the seventy-two customer disputes on the report. In the aggregate, settlements in the disclosed cases reflect well over a million dollars in payments by Fernando’s former firm to investors in connection with real estate security and non-traded REIT investments.
Fernando’s Response to the Complaints
In multiple BrokerCheck “Broker Statement” entries, Fernando attributes the disputes to BOK Financial’s selection and approval of non-traded REIT investments, stating in substance that:
- All of the complaints relate to BOK-approved non-traded REIT investments sold between 2015 and 2018.
- The firm purportedly conducted due diligence, provided the offering materials he used with customers, and approved each transaction.
- Liquidity problems arose when real estate markets were stressed and the REITs became hard to redeem, prompting investor complaints.
- BOK Financial later made a corporate decision to repurchase the investments from customers, and the settlement amounts reported are the firm’s buy-back payments, not payments made by Fernando personally.
- He maintains that he followed his employer’s instructions and did not personally fund any of the settlements or repurchases.
Regardless of Fernando’s explanations, the sheer volume of complaints involving real estate securities and non-traded REIT-style products is a red flag for any investor considering similar real estate investment trust (REIT) investments, particularly when those products are illiquid and complex.
Bullet-Point Summary of Key Disclosures
- Regulatory Action:
- 07/02/2024 Texas State Securities Board order (REG-24-CAF-05) reprimanding Fernando for recommending non-traded REITs without fully understanding the product features; final order; sanction: letter of reprimand.
- Customer Disputes:
- 72 customer disputes, all reported as “Customer Dispute – Settled,” involving real estate securities and non-traded REIT-type products sold primarily between 2015 and 2018 at BOK Financial Securities, Inc.
- Alleged damages per claim typically range from $50,000 to $500,000, often equal to the investors’ original principal invested.
- Settlement amounts in illustrative cases include $164,380.55, $243,369.26, $40,903.18, and $71,873.45, with all reported individual contributions by Fernando listed as $0.
- Common Allegations:
- Misrepresentation of product features, including risks, liquidity, and income.
- Unsuitable advice in light of the investors’ objectives and risk tolerance.
- Concentration in illiquid real estate securities and non-traded REITs that later became difficult to liquidate or declined in value.
Investors should understand that these disclosures are based on allegations that may be contested, and settlements are often reached without any admission of wrongdoing. Nonetheless, the pattern is consistent with the types of investment fraud and sales-practice violations that frequently lead to investor losses in non-traded REIT and alternative investment cases.
To obtain a copy of Gihan Anil Fernando’s FINRA BrokerCheck report, visit this link.
Robert Wayne Pearce Is Committed to Recovering Your Investment Losses
FINRA Rule 2111 requires that a broker or advisor have a reasonable basis to believe that a recommended security or investment strategy is suitable for the customer based on the customer’s investment profile, including factors such as age, financial situation, tax status, investment objectives, time horizon, and risk tolerance. The rule is generally understood to impose three main obligations: reasonable-basis suitability (understanding the product), customer-specific suitability (matching the product to the client), and quantitative suitability (ensuring the overall pattern of transactions is suitable).
In the context of Fernando’s non-traded REIT and real estate security recommendations, potential Rule 2111 concerns include:
- Whether he and his firm performed adequate due diligence to understand the structure, fees, distribution policies, and liquidity limitations of the REIT products before recommending them.
- Whether the investments were appropriate for investors who may have needed access to their principal, depended on stable income, or had conservative risk tolerances.
- Whether the size of the allocations—often large enough that the alleged losses equal the entire principal invested—resulted in overconcentrated positions in a single illiquid asset class.
If a broker recommends illiquid, complex REITs to investors who need income or liquidity and does so without a firm understanding of the product’s risks, regulators and arbitrators may find a violation of Rule 2111’s reasonable-basis and customer-specific suitability obligations.
FINRA Rule 2010 requires firms and associated persons to “observe high standards of commercial honor and just and equitable principles of trade” in the conduct of their business.(FINRA) Unlike product-specific rules, Rule 2010 is a broad ethical standard that can be applied to a wide range of misconduct, including negligence, misrepresentation, or failure to handle customer complaints fairly.
In cases like those involving Fernando, arbitrators may look beyond the technical suitability analysis to ask whether:
- The broker fairly and accurately described the risks, fees, and liquidity constraints associated with non-traded REITs and similar real estate securities.
- The firm and its representatives responded promptly and transparently when customers first raised concerns about lost income, suspended redemptions, or declining values.
- The overall pattern of conduct—dozens of nearly identical complaints alleging misrepresentation and unsuitable advice—reflects sales practices consistent with the “high standards of commercial honor” demanded by Rule 2010.
Even if each individual transaction might be defended as technically “suitable” based on limited account information, a pattern of misleading sales pitches, incomplete disclosures, or failure to correct earlier misstatements can still trigger liability under Rule 2010 for unfair or unethical business practices.
FINRA Rule 2210 governs “Communications with the Public” and sets principles-based content standards for written and electronic communications, including advertisements, sales literature, and correspondence with retail investors. Among other things, the rule requires that communications be fair and balanced, provide a sound basis for evaluating the facts about products and services, and not omit material information or include misleading statements.
In a case dominated by allegations that certain features of the products were misrepresented, Rule 2210 can be implicated in several ways:
- If written marketing materials, “fact sheets,” or email communications presented the non-traded REITs as low-risk income investments without adequately disclosing illiquidity, distribution risks, or potential declines in value.
- If sales presentations emphasized historical distributions or sponsor track records while downplaying fees, conflicts of interest, or the possibility of redemption suspensions.
- If the total mix of information—both written and oral—failed to provide investors with a balanced picture of risks versus potential benefits.
When many investors complain that they did not understand they were buying illiquid, principal-at-risk products, regulators and arbitrators often scrutinize whether the firm’s and broker’s communications complied with Rule 2210’s requirements for fair, balanced, and non-misleading disclosure.
For over 45 years, Robert Wayne Pearce has helped investors recover losses caused by broker fraud, negligence, and unsuitable recommendations. His firm, The Law Offices of Robert Wayne Pearce, P.A., represents clients nationwide on a no-recovery, no-fee basis. Call (800) 732-2889 or email pearce@rwpearce.com for a free case review with an experienced securities attorney.
