If you are have invested in Woodbridge Wealth or in any of the Woodbridge Mortgage Funds, you may be able to pursue recovery of any losses that you may suffer though securities litigation. Please call Kons Law Offices at (312) 757-2272 for a FREE, NO OBLIGATION consultation to discuss your legal rights and options.
How You Can Pursue Recovery of Your Woodbridge Mortgage Fund Investments.
According to a recent lawsuit filed by the Securities and Exchange Commission (SEC), the SEC is currently investigating the Woodbridge Group of Companies for possible violations ongoing violations of Sections 5(a), 5(c), and 17(a) of the Securities Act, and Section 15(a) and Section 10(b) of the Exchange Act and Rule 10b-5 thereunder, by Woodbridge and other persons and entities. Specifically, the Commission is investigating the offer and sale of unregistered securities, the sale of securities by unregistered brokers, and the commission of fraud in connection with the offer, purchase, and sale of securities.
According to court filings, Woodbridge has raised more than $1 billion from several thousand investors nationwide through multiple investment offerings using various forms and structures. In just one fund out of several, for example, Woodbridge Mortgage Investment Fund III, LLC, Woodbridge filed with the Commission on September 18, 2015, a Form D (Notice of Exempt Offering of Securities) averring that it had raised $36,330,251 out of a potential offering of $50,000,000. A network of nationwide sales agents (both internal and external) market these various investments and these sales agents are paid various levels of commissions for their efforts.
Woodbridge Funds have also had regulatory issues in Massachusetts and Texas. According to a Massachusetts enforcement action, the Woodbridge Funds are commercial lenders that make hard-money loans secured by commercial property. The Woodbridge Funds raise money from investors to help fund the hardmoney loans. The Woodbridge Companies refer to these investments as First Position Commercial Mortgages (“FPCM”). The Woodbridge Funds advertise that their management teams’ substantial experience lets them maintain a successful lending model and find lending opportunities that are favorable for investors. Investors do not have any role other than providing money. An FPCM consists of a promissory note from a Woodbridge Fund, a loan agreement, and a non-exclusive assignment of the Woodbridge Fund’s security interest in the mortgage for the underlying hard-money loan. The Woodbridge Funds pool money from multiple investors for each hard-money loan. The Woodbridge Funds’ promissory notes effectively guarantee the underlying hard-money loans, a nd the Woodbridge Funds’ advertising materials state that the Woodbridge Funds are obligated to make payments to FPCM investors even if the hard-money borrower defaults.
The FPCMs are securities in the form of notes, investment contracts, and real property investment contracts. FPCMs involve risks that are typically associated with real estate investments. An investor might need to sue the Woodbridge Fund or the third party hard-money borrower to recover the investment. The value of the real estate collateral for the hard-money loan might be too low due to depreciation or the Woodbridge Funds’ failure to properly value it. If the real estate does not adequately collateralize the loan, the Woodbridge Funds may fail to maintain enough liquid cash reserve to continue making payments to the investor. And the investor’s security interest in the real estate collateral could be invalidated by the Woodbridge Funds ‘ failure to properly perfect the real estate.
Some of the Woodbridge entities or Woodbridge Funds include the following:
- WMF Management, LLC
- Woodbridge Group of Companies, LLC
- Woodbridge Mortgage Investment Fund 1, LLC
- Woodbridge Mortgage Investment Fund 2, LLC
- Woodbridge Mortgage Investment Fund 3, LLC
- Woodbridge Mortgage Investment Fund PA, LLC
- Woodbridge Group of Companies, LLC (DBA Woodbridge Wealth)
How Can I Recover Money Invested with Woodbridge Wealth?
Please call Kons Law Offices at (312) 757-2272 for a FREE, NO OBLIGATION consultation to discuss your options regarding Woodbridge Wealth or any of the Woodbridge Mortgage Funds. Kons Law Offices represents investors nationwide in securities arbitration and litigation matters. To learn more about the Firm’s securities litigation and FINRA arbitration practice, please visit www.investmentlossattorney.com.