Coverage continues to roll in, helping to shed light on UDF’s Ponzi-like real estate scheme. Writing for FORTUNE, Jen Wieczner provides an overview of the position highlighting Kyle Bass’s experience with real estate investments.
“Investors have reason to trust Bass when it comes to real estate investments: The Texas hedge fund manager is known for making big money in 2008 by betting against subprime mortgages before the housing crisis. Last year, Bass’s bets proved prescient again when he shorted biotech stocks before drug pricing concerns caused that sector to take a dive.”
Wieczner expounds upon Hayman Capital’s position by summarizing Kyle Bass’s letter to readers, exposing the billion dollar house of cards.
“In a letter on that site, Bass alleged that UDF used money from one of the four funds to ‘bail out’ another one that was struggling, ‘using new investor money to pay existing investors’ in ‘a Ponzi-like real estate scheme.’ Bass expects that the firm’s downfall will be bankruptcy, calling UDF ‘a billion dollar house of cards” that ‘is now on the verge of collapse.’”