Customer Alert: FINRA Complaint Filed Against Spartan Capital Securities – Atlas Funds Investigated

Customer Alert: FINRA Complaint Filed Against Spartan Capital Securities – Atlas Funds Investigated

FINRA Complaint Filed Against Spartan Capital Securities – Atlas Funds Investigated

According to FINRA’s complaint in Proceeding No. 2021069218305, Spartan Capital Securities, LLC, John D. Lowry, and Kim M. Monchik recommended and sold interests in multiple private placement offerings (“the Atlas Funds”) between March 2021 and October 2021. During that period:

• Spartan allegedly made 346 recommendations to 191 customers — mostly retail investors — for a total principal value exceeding $24 million. FINRA

• Spartan allegedly earned over $2.4 million in placement fees from these offerings. FINRA

• The complaint alleges Spartan lacked a “reasonable basis” to believe the offerings were suitable or in clients’ best interests because it failed to perform adequate due diligence.

According to the complaint, the transaction structure involved unregistered funds (“Atlas Funds”) created and controlled by Lowry. Spartan served as the exclusive placement agent and stood to profit from substantial fees and undisclosed markups.

The complaint alleges that the offering documents (private placement memoranda, supplements) distributed to investors contained false or misleading information about: — the markups charged; — the price paid by the funds for the underlying pre-IPO interests; — whether a third-party affiliate was used; and — whether Lowry or his affiliated entities stood to profit — effectively concealing material conflicts of interest and misrepresenting costs.

Further, the complaint claims Spartan (with Monchik chiefly responsible for due diligence) did not conduct any independent, meaningful review to verify that the underlying “pre-IPO interests” actually existed or were valid, never confirmed ownership of those interests, and continued recommending the funds even after multiple unanswered requests for verification. FINRA

In sum — FINRA alleges Spartan’s recommendations were unsuitable, fraudulent or misleading, and that the firm breached both its Care and Conflict-of-Interest obligations under § 15l-1(a)(1) of the Exchange Act and violated FINRA Rules 2111, 3110, 2010, among others. FINRA

---

What This Means for Investors

If you invested in any of the “Atlas Funds” or other Spartan-placed private offerings you may be at risk of significant losses .

Because of the alleged misrepresentations, fee structures, and lack of proper due diligence:

• The value of your investment may be substantially impaired.

• You may have never been given critical information about fees, conflicts of interest, or the true economic interest of the fund promoters — hindering your ability to make an informed decision.

• If misconduct is confirmed, you might be entitled to recover your investment or losses through arbitration under securities laws protecting investors against fraud, misrepresentation, and unsuitability.

---

What You Should Do Right Now

If you have any investments with Spartan Capital, the Atlas Funds, or similar offerings:

1. Request and preserve all documentation you received: subscription agreements, private placement memoranda (PPMs), supplements, account statements, confirmations, notices, correspondence.

2. Contact Goodman & Nekvasil, P.A., a securities-fraud attorney experienced in private-placement misconduct to assess whether you have grounds for a claim.

Goodman & Nekvasil, P.A. has filed hundreds of cases on behalf of investors nationwide involving private placements, fraudulent offerings, and high-risk investments sold without proper disclosure. The firm has extensive experience pursuing recovery for victims of pre-IPO losses. If you are an affected investor, you should contact us immediately for a free, confidential evaluation of your claim. 

St. Petersburg, Florida law firm Goodman & Nekvasil, P.A., has a national practice representing victimized investors.  The  firm continues to investigate brokerage firms that placed elderly retirees and other conservative investors in unsuitable investments.

Goodman & Nekvasil, P.A., has filed numerous cases against brokerage firms selling high-risk investments and has recovered more than $500 million dollars on behalf of victimized investors.

We allege in these cases that these investment recommendations were unsuitable for our clients in view of their financial situation, needs and investment objectives.

There is no charge for an evaluation of your case. We handle our cases on a contingency fee basis. This means that unless we recover money for you, we charge no attorney’s fee.

If you incurred losses on your investment and would like your case evaluated by a securities attorney, please contact us.

Some of the information in this blog post was obtained from FINRA on 11/24/25. If you believe this information was reported incorrectly, please contact our firm: 1-800-500-4442.