The Securities and Exchange Commission is investigating embattled California luxury real estate developer Woodbridge Group of Companies, LLC, with SEC officials claiming the company directly and indirectly sold unregistered securities. In addition, Woodbridge CEO Robert Shapiro resigned and the firm filed for chapter 11 bankruptcy protection, while the company missed its December 1, 2017 payment to investors who purchased Woodbridge notes.
Former Royal Alliance Associates broker Frank John Capuano is an example of one former FINRA-registered broker whom regulators punished for engaging in undisclosed and unapproved private securities transactions by selling more than $1.1 million in Woodbridge notes.
According to a 2016 AWC, Capuano (CRD #844182) sold notes of Woodbridge Mortgage Investment Funds to nine Royal Alliance customers without seeking or obtaining firm approval, and without disclosing such sales, receiving approximately $34,000 in unauthorized commissions as a result.
Woodbridge Mortgage Investment Fund 1, 2, 3, and 4, as well as Woodbridge Investments LLC and Woodbridge Wealth are based in Sherman Oaks, California, and according to InvestmentNews, the SEC is investigating the offer and sale of unregistered securities, brokers' sales of securities, and fraud related to the offer, purchase, and sale of securities.
The state of Michigan, for example, in August 2017 issued Woodbridge Mortgage Investment Fund 4 a cease and desist notice, noting it had advertised the unregistered Woodbridge securities as "safer" with "higher yields and lower risk" than other investments, but engaged in material misrepresentations or omissions by failing to disclose financial troubles, defunct registration status, or the various cease and desist orders received from other states, including Massachusetts, Texas, and Arizona.
Woodbridge Group of Companies additionally lists "Woodbridge Realty Unlimited" as a division; Woodbridge Realty operates in the Aspen and Roaring Fork Valley, Colorado area; in Southern California, Woodbridge Luxury Homes dabbled in real estate and so-called mega-mansion development in the Sherman Oaks, Hidden Hills, Beverly Hills, and Bel Air neighborhoods.
The indirect sales of unregistered securities charge means that otherwise-registered broker-dealers, such as the aforementioned Royal Alliance Associates, may have participated in unsuitable sales of these products, for instance, by selling notes in Woodbridge.
The SEC investigation found that Woodbridge raised as much as $1 billion through various funds, notes, and other securities sold to investors before its 2017 bankruptcy filing.
If you have invested with Royal Alliance Associates' Frank John Capuano, or with any broker, financial adviser, or firm in the Woodbridge Group of Companies, including promissory notes in the Woodbridge Mortgage Investment Fund family, or with Woodbridge Wealth, and these unregistered sales have proven harmful to your investments when the company failed to fulfill or pay out returns or promised yields, please call The Law Offices of Jonathan W. Evans & Associates at (800) 699-1881 for an investigation and consultation.