A Southern California real estate development company is accused of stealing tens of millions from its investors. On suspicion,…
A Southern California real estate development company is accused of stealing tens of millions from its investors.
The company is believed to have acted in many ways, such as "overstating its assets" and "hiding important facts from investors." In some cases, it simply refused to return the investment money even though an exit clause was entered into the investor contract.
An Orange County (Southern) resident who heads a real estate development company is accused of stealing huge $ 44 million from investors, according to court documents this week.
Investors filed two huge lawsuits against William Schoffhoff, who served as president and CEO of Shopoff Realty Investments in Irvine. In addition, a financial fine will be imposed on him by FINRA, the Financial Industry Regulatory Authority.
Shopoff has raised funds to invest in projects across the United States, including apartments and businesses in California, Illinois and North Carolina. Only last March the company sold a complex of 624 housing units for 100 million.
According to the complaint filed with FINRA, William Schoffhoff plotted to steal $ 12.5 million from 29 investors between 2010 and 2017. He worked with his brother, Stephen, and a company called “Shopoff Securities”. The complaint states that the Schoffhof brothers did not bother to explain to investors that their money would be used to cover William's personal costs, and to return the investment money of other investors.
Despite the fact that he is guarantor of his own and his wife's investment, Schoffhof did not disclose to investors that it was non-liquid capital: The complaint also explained that the company "hid important facts for investors and those that were not hidden were presented in a very different way from reality". For example, the company did not update that its budget deficit tapped from $ 2.8 million to $ 22.6 million during the work on one of the projects.
Complainants demand that the company “hand over any unjustly achieved profit” to investors. On the other hand, Shopoff denies her attribution and vows to fight charges in court: “These are baseless allegations. All lenders received their money including interest as agreed with them. No injustice has been done to any of the investors, ”as the company said.
As mentioned, huge lawsuits were even filed against the company on the grounds that the company did not return $ 31 million in funds to investors. According to the lawsuit, the investment contract includes a “buy out” section whereby investors can get their money back at a pre-determined price. Investors say they did not receive the money despite the requirement to act in accordance with the contract.
Schopfoff's lawyers refused to comment on the report and claimed that they would prove his innocence in court.
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- It's good to know that there are those who supervise companies that do not behave fairly with investors.
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