Lost Money in the Easterly ROCMuni Fund (RMHIX)? Iorio Law PLLC Investigates Osaic and Janney Montgomery Scott

Iorio Law PLLC is actively investigating sales practices by broker-dealers, including Osaic and Janney Montgomery Scott, concerning their recommendations of the Easterly ROCMuni High Income Municipal Bond Fund (tickers: RMJAX, RMHIX, RMHVX). This mutual fund, marketed as a source of high-income returns, has collapsed, leaving investors with catastrophic losses. The fund has significantly underperformed and has been rated only one star by Morningstar, indicating poor performance relative to peers long before its recent failure.

Investors who were placed in this fund have experienced a devastating decline in their investment’s value, raising serious questions about whether brokerage firms like Osaic and Janney Montgomery Scott adequately disclosed the fund’s inherent risks and properly assessed the suitability of these investments for their clients.

For investors seeking to recover their losses, it is critical to understand that you may have a better and more direct path to recovery through a FINRA arbitration claim against your brokerage firm than by joining a class-action lawsuit.

Understanding the Easterly ROCMuni High Income Municipal Bond Fund

The Easterly ROCMuni High Income Municipal Bond Fund, managed by Easterly Investment Partners LLC, was pitched as a tax-efficient strategy for yield-driven returns. The fund claimed to use sophisticated credit analysis to invest in a diversified portfolio of high-yield municipal bonds.

Under normal conditions, the fund invests at least 80% of its net assets in tax-exempt debt securities, using bottom-up credit analysis to select high-yield bonds for a supposedly diversified portfolio.

However, the reality of the fund’s holdings painted a much riskier picture. The fund was dangerously concentrated in highly speculative bonds:

• Junk-Rated Debt: Nearly 80% of its holdings were rated BB+ or lower (junk status) or were in default.
• Non-Rated Debt: Over 83% of its holdings were non-rated, making their true credit quality difficult for investors to assess.
• Illiquid Assets: The fund was heavily invested in “Rule 144A” private placements, which are illiquid and hard to sell, especially in a stressed market.

The fund’s performance has been dismal, earning it a one-star overall Morningstar rating as of June 30, 2025, placing it at the bottom of its category. The collapse was swift and brutal:

• The fund’s Net Asset Value (NAV) plummeted to just $2.94 as of August 1, 2025, delivering a staggering -56.44% year-to-date return.
• On June 13, 2025, the fund’s NAV for its RMHIX shares was slashed by over 30% in a single day, dropping from $6.15 to $4.33.
• Total assets in the fund collapsed from over $230 million on March 31, 2025, to less than $17 million by July 8, 2025.

Top holdings include securities like the Children’s Trust Fund Puerto Rico Tobacco Settlement Revenue bonds (4.37% of the portfolio), highlighting exposure to high-risk territorial issuers such as Puerto Rico, which have historically been volatile due to economic and fiscal challenges. Despite disclosures warning of general market fluctuations, critics argue that the fund’s prospectus omitted material risks related to illiquidity, lack of diversification, and flawed pricing methodologies.

The Broker’s Duty: Did Osaic and Janney Montgomery Scott Fail Their Clients?

Brokerage firms like Osaic and Janney Montgomery Scott are regulated by the Financial Industry Regulatory Authority (FINRA). FINRA’s rules require financial advisors to have a reasonable basis to believe an investment is suitable for their client based on their age, financial situation, investment objectives, and risk tolerance.

Iorio Law PLLC’s investigation is focused on whether brokers at these firms violated that fundamental duty. We are asking:

•  Did your broker accurately disclose that the Easterly ROCMuni fund was a high-risk, one-star “junk” bond fund?
• Was a speculative fund like this suitable for you, especially if you are a conservative investor or retiree seeking stable income and capital preservation?
• Did your broker perform adequate due diligence before recommending this fund, or were they just chasing a high commission or yield?
• Did your broker overconcentrate your assets in this single fund, exposing your portfolio to a catastrophic level of risk?

Brokerage firms also have a duty under FINRA rules and federal securities laws to conduct thorough due diligence on the investments they recommend and to ensure those recommendations are suitable for their customers based on individual financial circumstances, risk tolerance, and investment objectives.

Our investigation focuses on whether Osaic and Janney Montgomery Scott:

• Failed to perform adequate due diligence on the Easterly ROCMuni High Income Municipal Bond Fund.
• Misrepresented or omitted critical information regarding RMHIX’s risks, objectives, and performance metrics.
• Improperly recommended RMHIX to conservative investors seeking stable, low-risk returns.

Public reports have already surfaced that law firms are investigating Osaic for its role in promoting the fund. Our investigation extends to other firms like Janney Montgomery Scott that may have engaged in similar unsuitable sales practices, placing their clients’ capital in harm’s way.

Why FINRA Arbitration Is a Better Path Than a Class Action

When a fund like this collapses, a class action lawsuit is often filed. However, investors should know that they are not obligated to join it. Iorio Law PLLC strongly believes that investors generally have a better chance at a meaningful, individual recovery through FINRA arbitration.

Class actions can take years to resolve and often result in small payouts for individual investors after legal fees and administrative costs are deducted. In contrast, FINRA arbitration offers:

• A Faster Resolution: The process typically concludes within 12-18 months.
• An Individualized Case: The claim focuses on your specific conversations with your broker and your unique financial damages.
• Higher Potential Recoveries: Arbitration panels can award damages based on your personal losses, which can be significantly more than you would receive from a class action settlement.

We’ve recovered millions for investors in similar high-risk bond cases, including GWG L Bonds and Puerto Rico bonds. If you bought the Easterly ROCMuni Fund through Osaic, Janney, or another broker, you may have a strong claim.

Take Action Today to Recover Your Easterly Fund Losses

You trusted your financial advisor to provide sound investment advice. If they placed you in the Easterly ROCMuni High Income Municipal Bond Fund without a full explanation of the risks, leading to significant financial losses, you have the right to hold them and their firm accountable.

Contact Iorio Law PLLC today for a free, confidential consultation. We will review your case, examine the advice you received from your Osaic or Janney Montgomery Scott broker, and explain your legal options for recovering your losses through a FINRA arbitration claim. Don’t wait for a class action to pay you pennies on the dollar—take control of your financial recovery.

Schedule Your Free Consultation Today

Based in New York, NY, Iorio Law PLLC is a trusted securities arbitration law firm with a proven track record of representing investors harmed by broker misconduct. Our attorneys combine legal expertise with a client-centered approach, ensuring personalized attention and aggressive advocacy.

Contact Iorio Law PLLC today for your free, confidential consultation. We are here to fight for your financial recovery.

📞 Call: (646) 330-4624
📧 Email: info@iorio.law
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