Investigations Launched After Dramatic Losses of Easterly ROCMuni Fund

In a shocking turn of events, the Easterly ROCMuni High Income Municipal Bond Fund (formerly known as the Principal Street High Yield Fund) saw a staggering decrease in value, losing half of its worth between June 12 and June 16, 2025. This sharp decline has raised red flags, leading to investigations by law firms such as Deutsch Lipner and The Law Offices of Jonathan W. Evans & Associates.

A Deeper Look into the Fund’s Structure

Despite its seemingly benign name, the Easterly ROCMuni Fund has been criticized for its underlying investments. Attorneys allege that the fund operated more like a junk bond fund, heavily invested in illiquid and low-rated corporate securities. Such investments have instigated concerns regarding the suitability of the fund for conservative investors, including retirees who typically seek safer, more stable financial options.

In December 2023, industry expert Eric Jacobson published a cautionary article in Morningstar, where he expressed concerns about the liquidity risks associated with the bonds held by the fund. The article was a warning that some investors might have overlooked, contributing to their significant losses as a result of the fund's unexpected collapse.

Allegations of Inappropriate Recommendations

The investigations by Deutsch Lipner and The Law Offices of Jonathan W. Evans & Associates are centered around claims that financial advisors failed to heed these warnings. According to their findings, several advisors, including those linked with Commonwealth Financial, may have misguided investors by recommending investments in the Easterly ROCMuni Fund without properly disclosing its inherent risks. As complaints from investors begin to surface, there is a growing sentiment of mistrust towards the financial advisors involved.

As representatives for multiple investors who have faced losses, these law firms are actively pursuing additional information related to transactions involving the fund. They are particularly interested in obtaining sales materials, performance forecasts, and communications that highlight the fund's risks and its suitability for various investor profiles.

The Firms’ Experience and Approach

Deutsch Lipner and The Law Offices of Jonathan W. Evans & Associates possess over a century of combined experience in representing investors in FINRA arbitration claims. They take pride in recovering substantial amounts for their clients, having secured hundreds of millions of dollars in the past for aggrieved investors across the U.S. The firms are urging individuals who have information about advisors recommending the Easterly ROCMuni Fund to come forward, potentially assisting in shaping a case against those who may have engaged in negligence or misrepresentation.

The legal actions surrounding the Easterly ROCMuni Fund case illustrate the crucial importance of due diligence and transparency in the investment advisory landscape. It emphasizes the need for both advisors and investors to be acutely aware of the risks associated with financial products, especially those marketed as safer investment vehicles.

Conclusion

As the investigation unfolds, more details will likely come to light regarding the role of financial advisors and the actual investment strategy of the Easterly ROCMuni High Income Municipal Bond Fund. Investors are encouraged to remain vigilant and informed, ensuring that their portfolios reflect their risk tolerance and financial goals. The lessons learned from this situation could have far-reaching implications for the advisory industry and its practices surrounding recommended investments.