According to reports, United Development Funding IV has been subpoenaed to hand over company documents to a grand jury.
The FBI last week raided the suburban Dallas offices of UDF IV, a REIT that listed on the Nasdaq in 2014 and had $684 million in total assets. According to a filing with the Securities and Exchange Commission, at the same time as they executed their search, “law enforcement officers served executive officers of the trust and certain other employees of the trust’s advisor and its affiliates” with the subpoenas for company document.
The share price of UDF IV collapsed after the news of the FBI raid came to light. UDF shares fell almost 55% during trading on Thursday to $3.20 per share. On the same day, the Nasdaq told UDF it was halting trading in its shares.
The White Law Group continues to investigate potential claims involving United Development Funding IV.
Specifically, the firm is looking at the potential liability that brokerage firms may have for recommending this investment.
Brokerage firms that sell such non-traded REITs like UDF IV are required to perform adequate due diligence on the investments to ensure a reasonable likelihood of success, and to evaluate whether the investments are suitable in light of the client’s age, net worth, investment experience, and investment objectives. Firms that fail to perform adequate due diligence, or that make unsuitable recommendations, can be held responsible for losses in a FINRA arbitration claim.
If you suffered losses investing in UDF and would like to discuss your litigation options, please call the securities attorneys of The White Law Group at (888) 637-5510 for a free consultation.
The White Law Group is a national securities fraud, securities arbitration, and investor protection law firm with offices in Chicago, Illinois and Vero Beach, Florida. The firm represents investors in FINRA arbitration claims throughout the country. Visit the firm’s homepage to learn more about the firm’s representation of investors.