SEC charges Northridge Holdings & entities with engaging in alleged $41 million fraud scheme.
The White Law Group is investigating potential securities fraud lawsuits involving sales agents who may have unsuitably recommended Northridge Holdings offerings to investors.
According to a press announcement on September 5, 2019, the Securities and Exchange Commission reportedly filed an emergency action against Glenn C. Mueller, his company Northridge Holdings, Ltd., and other affiliated entities charging them with engaging in an alleged $41 million fraudulent, unregistered securities offering.
The SEC’s complaint alleges that since at least May 2014, the defendants have sold more than $41 million in promissory notes in unregistered transactions to over 300 investors throughout the country, many of whom were reportedly unaccredited and of retirement age.
According to the complaint, Mueller and Northridge allegedly told investors that the funds would be used to purchase and renovate multi-unit real estate properties, resulting in “profits derived from higher occupancies and rents, and/or the resale of the properties or individual units.”
The SEC alleges that the notes were represented to investors as “safe” and “low risk,” and that the company allegedly referred to certain notes as “CDs.” Although the company reportedly claimed it was a financial success, Northridge’s business was purportedly not profitable and did not generate sufficient revenues to cover its expenses and pay promised returns to investors, and investors’ funds were purportedly not used as represented, according to the SEC’s allegations.
In Ponzi-scheme fashion, the defendants allegedly used a significant portion of the funds raised from new investors to pay returns to earlier investors. They also purportedly paid “finders” for referrals to Northridge, as well as for securities trading and purported loans to members of Mueller’s family.
The SEC’s complaint charges Glenn C. Mueller, Northridge Holdings, Ltd., Southridge Holdings, Ltd., Eastridge Holdings, Ltd., Brookstone Investment Group, Ltd., Guardian Investment Group, Ltd., Unity Investment Group Ltd., and Amberwood Holdings L.P. with allegedly violating securities laws.
The SEC’s complaint reportedly seeks injunctions against future securities law violations, disgorgement of the defendants’ ill-gotten gains, and civil penalties.
The United States District Court for the Northern District of Illinois reportedly entered orders imposing a preliminary injunction, freezing Mueller’s assets, and appointing a receiver over the assets of the other defendants on September 12.
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If you are concerned about your investments with Northridge Holdings LTD, the securities fraud attorneys at The White Law Group may be able to help you. Please call our offices at 888-637-5510 for a free consultation.
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