October 21, 2021 Comments Off on Four United Development Funding Execs Charged with Felony Counts of Fraud   Blog, Current Investigations

Four United Development Funding Execs Charged with Felony Counts of Fraud  

Four United Development Funding Execs Charged with Felony Counts of Fraud, featured by top securities fraud attorneys, The White Law Group

United Development Funding UDF Shareholder Lawsuits Update

Have  you suffered financial losses investing in United Development Funding offerings? If so, the securities attorneys at the White Law Group may be able to help you recover your losses through FINRA arbitration.

According to an indictment on October 18, federal prosecutors have charged four executives of United Development Funding, a real estate investment trust, with allegedly defrauding banks and using investor money to stay afloat. 

Prosecutors allege that from January 2011 to December 2015, the four defendants and others, purportedly engaged in a scheme to defraud using United Development Funding investment fund entities (UDF Fund III, UDF Fund IV, and UDF Fund V). The charges allege the four executives plotted to conceal the true performance of the fund’s business and its financial condition to encourage investment and enrich themselves. The UDF managers allegedly defrauded investors and obtained money from banks by failing to disclose that shareholder funds were being used to repay developer loans and issue distributions to earlier investors, according to the indictment. 

The criminal indictment follows a settlement with the SEC in 2018 when the four executives reportedly agreed to pay $8.2 million in disgorgement, prejudgment interest, and civil penalties for similar charges. 

Potential Lawsuits to Recover Financial Losses 

The White Law Group has represented numerous investors in claims against their brokerage firms for improperly recommending an investment in UDF Funds. 

For more information on the firm’s investigation please see: 

UDF IV-United Development Funding IV- Lawsuits to Recover Financial Losses 

United Development Fund IV (UDF IV) Delisted by NASDAQ  

UDF IV Appeal Dismissed  

UDF reportedly raided by FBI 

The Risks of Non-Traded REITs

The trouble with non-traded REITs is that they are complex and inherently risky products. Lack of liquidity is often problematic for many investors.  Investors looking to sell often have difficulty finding a buyer, and can suffer significant losses on the sale. 

Broker dealers are required to inform clients of the risks associated with investment recommendations and to ensure that those recommendations are suitable for the investor in light of the investor’s age, risk tolerance, net worth, and investment experience. Firms that fail to do so, may be held responsible for any losses. 

The Financial Industry Regulatory Authority (FINRA) can help resolve problems and disputes through two non-judicial proceedings: arbitration and mediation. FINRA’s Dispute Resolution forum handles nearly all of the securities-related arbitrations and mediations in the United States. 

These claims are distinct from the class action filed directly against United Development Funding and could be pursued concurrently. 

If you have suffered losses investing in United Development Funding (UDF), please contact The White Law Group at 888-637-5510 for a free consultation. 

The White Law Group, LLC is a national securities fraud, securities arbitration, investor protection, and securities regulation/compliance law firm with offices in Chicago, Illinois and Seattle, Washington. For more information on the firm, visit www.WhiteSecuritiesLaw.com. 

  

 

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