The attached complaint was filed by the SEC and alleges from at least January 2011 through December 2015, UDF used money from a newer fund to pay distributions to investors in an older fund, without adequately disclosing the use of funds and the nature and status of loans made to developers.
The Securities and Exchange Commission announced charges against two real estate investment funds and four executives in connection with their alleged roles in misleading investors by failing to disclose that it was using money from a newer fund to pay distributions to investors in the older fund.
Attached is the Final Judgment as to Defendants Hollis M. Greenlaw, Benjamin L. Wissink, Theodore F. Etter, Cara D. Obert, and David A. Hanson.
“In all events, Hayman’s posts that UDF contends are false are also public record. There is no concealment issue here. And, because the statements are about UDF itself, it has the ability to determine whether they were in fact false. Application of the privilege would not in any way prevent UDF from discovering its claim or proving its case if, as it contends, the posts contained untrue statements."
“Thus, in addition to failing to meet its burden of establishing a prima facie case of fraud, UDF failed to establish a prima facie case of a crime or otherwise attempt to overcome its heavy burden of piercing the attorney–client privilege.”
FINRA FINDS THAT UDF FOUNDER, WHILE BARRED FROM SECURITIES INDUSTRY, USED WIFE TO SELL $42 MILLION IN UDF SECURITIES AND OBTAIN $2.87 MILLION IN INVESTOR MONEY AS COMMISSIONS