The U.S. Securities and Exchange Commission (SEC) has been investigating Woodbridge Group of Companies, a real estate and investment company based in Sherman Oaks, California, that has raised over $1 billion from investors, under allegations of operating as a fraud.
California Firm is Suspected of $1 billion Scheme
According to court documents, in August the SEC sent subpoenas to 235 LLCs, which the Commission believes are owned and/or controlled by Woodbridge president Robert Shapiro. The inquiry is part of an ongoing year-long investigation into Woodbridge regarding the possible improper sale of securities.
The Commission states that it did not receive a sufficient response from the entities. As of recent court filings, the SEC received a response from only one LLC entity that said it was not affiliated with Woodbridge or Woodbridge president Robert Shapiro.
The subpoenas were sent to gather information and documents about payments the LLCs made to Woodbridge, the names of the LLC’s managers or members, as well as information regarding financial institutions of the LLCs.
According to the filing, the SEC alleges that the LLCs failed to produce any documents. The SEC’s latest application seeks an order from the federal district court compelling respondents to comply with the SEC’s subpoenas.
“As the investigation has unfolded, it has come to the attention of the Commission’s investigative team that there are numerous LLCs that are interwoven into the structure of products Woodbridge offers for investment,” states SEC documents. “Specifically, the Commission is investigating the offer and sale of unregistered securities, the sale of securities by unregistered brokers and the commission of fraud in connection with the offer, purchase and sale of securities.”
Woodbridge claimed that it has and will continue to cooperate with all SEC requests. The company further stated that its wealth management group, Woodbridge Wealth, sells three types of investments: first position commercial mortgages with an annual yield of 5%, secondary-market annuities with “above-average risk -adjusted yields,” and a commercial bridge loan fund that potentially returns 6%.
According to BrokerCheck, there is no broker-dealer named Woodbridge Wealth registered with FINRA.
Have You Invested Money with Woodbridge Group?
If you believe you have been the victim securities fraud or other investment scheme, you may have certain legal rights that require your immediate attention.
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If you are looking for an securities fraud attorney to review your rights and options, the securities fraud lawyers at Dimond Kaplan & Rothstein, P.A. have recovered over $100 million from banks and brokerage firms for their wrongful actions.