If you are an investor who purchased IHC securities through Emerson, this motion—and the documents it seeks to uncover—could be critical to understanding what happened to your investment.

The Motion Is A Broad Investigation Into Emerson’s Conduct

The Debtors have filed a motion for entry of an order pursuant to Bankruptcy Rule 2004, specifically targeting Emerson and its affiliates. Under bankruptcy law, Rule 2004 provides the court with authority to order an examination of any entity if it relates to the acts, conduct, property, or financial condition of the debtor. Courts have often compared this investigatory tool to a licensed fishing expedition because its scope is virtually unlimited.

The Debtors argue that this examination is reasonably necessary to protect their legitimate interests and to establish potential claims. Specifically, the Debtors seek to:

• Investigate potential claims and causes of action belonging to the Debtors.
• Maximize the value of the Debtors for all creditors and stakeholders.
• Uncover important records, documents, and communications regarding the business and dealings with third parties that are in the possession, custody, or control of Emerson.

Prior to the bankruptcy filing on February 2, 2026, Emerson served as the broker-dealer for the Debtors and assisted in equity fundraising activities through the marketing and sale of certain securities. The Debtors allege that Emerson was substantively involved with the operation of the business and was privy to other important facets of the Debtors through its position as broker-dealer.

What are the Debtors Hunting For? The Requests for Production

In their proposed Rule 2004 document requests, the Debtors have outlined 12 specific categories of documents they are demanding from Emerson. The depth of these requests suggests the Debtors are looking for evidence of wrongdoing or mismanagement that occurred during the four-year period before the petition date.

Key documents requested include:

• Corporate structure: Documents sufficient to show the corporate structure of Emerson and its affiliates, including directors, officers, and board members.
• Financial Transfers: Documents sufficient to show any and all transfer of funds by Emerson to or from Holdings, its affiliates, subsidiaries, and directors or officers.
• Internal Communications: All communications, including texts, WhatsApp, or other instant messages sent through services like Gmail, Facebook, or iMessage, between Emerson and the directors or officers of the Debtors concerning the bankruptcy, private-placement offerings, and investor distributions.
• The Patrick Lam Connection: The motion specifically seeks all documents and communications concerning any ethical walls or similar restrictions put in place with respect to Emerson and Patrick Lam.
• Commissions and Fees: Documents sufficient to show commissions and fees paid by Emerson to Patrick Lam or any other employee of the Debtors.
• Investor Relations: All documents and communications between Emerson and any investor or potential investor regarding the Debtors.
• Regulatory Scrutiny: All documents produced to and transcripts of any testimony or interview given to any state or federal regulator, prosecutor, or administrative agency in connection with investigations of the Debtors.
• Insurance and Indemnity: All insurance policies and indemnification agreements that cover or potentially apply to claims arising from Emerson’s service as a broker-dealer for the Debtors.

The Timeline: What Happens Next?

The Debtors also noted that they understand Emerson would not agree to provide the requested information voluntarily and that the motion had to be presented to the court for determination. This indicates a potentially adversarial relationship developing between the Debtors and their former broker-dealer as they seek to fulfill their duty to investigate prepetition conduct.

Why This Matters to You as an Investor

For many investors, the central question is where the money went and who is responsible. By invoking Rule 2004, the Debtors are using the power of the Bankruptcy Court to investigate the relationship between the Debtors and Emerson. The discovery of undisclosed fees, conflicts of interest, or regulatory communications could provide the foundation for future legal actions to recover funds for the Debtors—and ultimately, for the benefit of creditors and stakeholders.

The mention of Patrick Lam and ethical walls is particularly noteworthy, suggesting that the Debtors are investigating whether proper boundaries were maintained or if there were internal lapses that contributed to the current financial state of the 161 Debtors.

Note to Investors

Our firm is closely monitoring the production of these documents. If you invested in Inspired Healthcare Capital, the information uncovered in this fishing expedition may be vital to your recovery efforts. Please contact us to discuss your options.

For many investors, Inspired Senior Living of Hamilton DST was marketed as a stable, income-producing vehicle perfect for a 1031 tax-deferred exchange. However, recent developments—including a February 2, 2026, Chapter 11 bankruptcy filing—have left investors facing significant losses and an uncertain future.

If you invested in this Delaware Statutory Trust (DST) upon the recommendation of a broker or financial advisor, it is critical to understand your rights to recovery through FINRA arbitration.

The Collapse of the Income Promise

Launched in May 2022, the Hamilton, New Jersey property was a 195-unit senior housing facility. The offering raised millions in equity from accredited investors, and promised consistent annualized distributions.

The reality has been starkly different:

• Suspended Distributions: In mid-2025, Inspired Healthcare Capital (IHC) halted all investor distributions.
• SEC Investigation: The company confirmed it is under formal investigation by the Securities and Exchange Commission.
• Insolvency Allegations: Lawsuits have alleged that the sponsor was insolvent as early as late 2024, despite continued capital raises.
• Bankruptcy: On February 2, 2026, Inspired Healthcare Capital and its affiliated DSTs, including the Hamilton entity, filed for Chapter 11 bankruptcy protection.

Why This Matters to You: The Broker’s Responsibility

While the sponsor’s bankruptcy limits direct recovery from IHC, it does not prevent you from pursuing the brokerage firm that sold you the investment. Under FINRA Rule 2111 (Suitability) and Regulation Best Interest (Reg BI), brokers have a legal obligation to:

1. Conduct Due Diligence: Did the firm ignore red flags regarding the sponsor’s financial health?
2. Assess Suitability: Was a high-risk, illiquid DST appropriate for a retiree seeking stable income?
3. Disclose Risks: Were you told this was “safe” while the broker pocketed high commissions (often totaling 12% or more in combined fees)?

The Path to Recovery: FINRA Arbitration

Many investors are now discovering that their portfolios were over-concentrated in IHC products. Unlike a traditional lawsuit that can languish in court for years, FINRA arbitration offers a streamlined path to seek damages from the broker-dealers who failed in their duty to protect you.

Note: While the bankruptcy court handles the restructuring of the property, your claim against your financial advisor is a separate legal path designed to recover your principal investment.

If you own interests in Inspired Senior Living of Hamilton DST or any other Inspired Healthcare Capital offering, the time to act is now. Please contact us today.

As a securities attorney, I was very interested to read the Declaration of M. Benjamin Jones, IHC’s Chief Restructuring Officer (CRO), which was filed in support of the bankruptcy. This document provides a startling look into allegations of mismanagement, the use of “Ponzi-like” cash movements to sustain investor distributions, and the misappropriation of millions in investor capital for luxury personal expenses.

If you are a DST or Fund Investor, here is a summary of the critical revelations from the CRO’s declaration and what they may mean for your recovery options.

1. The Magnitude of the Collapse

IHC’s operations were vast, spanning 33 operating senior-living facilities across 14 states, housing approximately 2,620 residents. To fuel this growth, IHC utilized two primary fundraising channels:

• DST Offerings: Targeted at investors seeking Section 1031 Tax Exchanges, raising significant capital from roughly 2,300 investors.
• Investment Funds: Ten different funds that raised over $390 million from more than 3,300 investors through the sale of promissory notes and equity securities.

The declaration reveals that while the portfolio may have appeared robust to mom-and-pop investors, the underlying financials were often hollow.

2. Artificial Distributions and “Cash Subsidies”

One of the most troubling admissions in the declaration is that IHC was often using new capital to pay old obligations. Jones states that “many Communities never generated sufficient net operating income to pay all obligations.”

Of the 31 DST Communities, only 8 operated without a direct cash subsidy from the company. To maintain the appearance of performance and keep distributions flowing to investors, IHC’s former management allegedly moved money between businesses. This included using funds from the Investment Funds to support underperforming DSTs. This circular flow of cash is a hallmark of troubled investment schemes and often serves to mask insolvency from investors and regulators alike.

3. Allegations of Mismanagement and Misappropriation

Perhaps the most damaging portion of the declaration for IHC’s former leadership concerns the use of company funds for personal gain. Jones notes that a preliminary analysis suggests investor funds were not always used for their intended purposes.

Specifically, the declaration alleges that former management used company money to acquire:

• Luxury vehicles and a condo in Las Vegas.
• Real estate titled in the name of a non-debtor company owned by former CEO Luke Lee and his wife.
• Significant non-business expenses and personal purchases.

These expenditures were reportedly recorded on the company’s own books, yet investors were left in the dark as their distributions were suspended in June 2025.

4. The Role of Broker-Dealers

For many investors, the entry point into IHC was through a financial advisor or broker-dealer. The declaration highlights that IHC was “heavily reliant” on these intermediaries, who profited handsomely from the relationship.

According to the filing, broker-dealers received more than $100 million in commissions and fees for raising capital for IHC. Emerson Equity, LLC is specifically identified as the managing broker-dealer for 29 of the DSTs and all of the Investment Funds. Under FINRA rules, broker-dealers have a rigorous duty to conduct due diligence on the products they sell. The fact that IHC was allegedly using intercompany “subsidies” to pay distributions as early as 2020 raises serious questions about whether these firms met their regulatory obligations to investors.

5. Current State of the Bankruptcy

Since the SEC initiated a formal investigation in April 2025, IHC has undergone a complete governance overhaul. Independent managers have been appointed to secure books and records, and M. Benjamin Jones was brought in as CRO to navigate the Chapter 11 process.

The company currently faces:

• $260 million in secured third-party debt.
• $165.8 million in total unsecured liabilities, including $148 million in unsecured investor promissory notes.
• Multiple lawsuits, receivership actions, and foreclosures across several states.

The stated goals of the bankruptcy are to maintain resident care, centralize litigation, and pursue a sale process to maximize value. However, in many healthcare bankruptcies of this nature, the recovery for unsecured investors can be cents on the dollar.

What Should IHC Investors Do?

If you invested in an IHC DST or one of their private funds (such as the Income Funds or Development Funds), the bankruptcy filing is a “stay” on your ability to sue the company directly, but it does not stop you from pursuing claims against the broker-dealers and financial advisors who recommended these investments.

Many investors were told these were “safe,” “income-producing” real estate holdings. The CRO’s declaration suggests the reality was a liquidity-constrained enterprise propped up by misappropriated funds and internal subsidies.

Our firm is currently investigating potential claims for:

• Unsuitable Recommendations: Did your advisor ignore your risk tolerance?
• Failure to Conduct Due Diligence: Did the broker-dealer miss the “red flags” regarding IHC’s internal cash movements?
• Misrepresentations and Omissions: Were you told the truth about the source of your distributions?

The window to recover losses through FINRA arbitration or civil litigation may be limited. If you invested in Inspired Healthcare Capital, it is imperative that you have your investment documents reviewed by experienced securities counsel.

Oregon’s securities laws (often called “Blue Sky Laws”) are among the most investor-friendly in the country. Here is a breakdown of how ORS 59.115 works and why it might be your best path to financial recovery.

What is ORS 59.115?

At its core, ORS 59.115 is a statute that holds people accountable for selling securities through fraud, untruths, or even “technical” violations (like failing to register the investment with the state).

The most important thing for victims to know is that Oregon law doesn’t just go after the “con artist” at the center of the scheme—it casts a much wider net.

1. You Don’t Just Sue the Scammer

In many fraud cases, the person who actually stole the money is long gone or broke. Oregon law recognizes this. Under ORS 59.115(3), you can often hold “secondary” parties liable if they participated in or materially aided the sale. This can include professionals who participated in or provided material aid to the scheme, such as accountants, lawyers, and banks.

2. The Due Diligence Requirement

In a standard fraud case, you usually have to prove the person knew they were lying (this is called “scienter”). Under Oregon’s securities law, the burden is often flipped. Anyone who participated or materially aided the sale is “jointly and severally” liable for the full amount of the loss unless they can prove they did not know, and in the exercise of reasonable care could not have known, of the violation of the Oregon securities laws they participated in.

What Can You Actually Recover?

Oregon law aims to make the victim “whole” again. If you win a claim under ORS 59.115, the formula generally includes:

1. Your Full Principal: The total amount of money you invested.
2. Statutory Interest: Interest on your money (currently 9% per year under ORS 82.010) calculated from the day you made the investment.
3. Attorney Fees & Costs: This is the “hammer.” The court has the power to order the defendants to pay your legal bills, making it possible for attorneys to take these cases on a contingency basis.

The Clock is Ticking: Statutes of Limitations

You cannot wait forever to file a claim. In Oregon, the general rule for securities fraud is:

• 3 years from the date of the sale; OR
• 2 years from the date you discovered (or should have discovered) the fraud.

Whichever comes later—but there are ultimate “caps” on these timelines, so acting the moment you suspect foul play is critical.

Do You Have a Claim?

If you live in Oregon or invested in an Oregon-based company and believe you were misled, you shouldn’t have to navigate the recovery process alone. Please contact us.

Our firm is currently investigating the role of banks in the Prestige Funds Ponzi scheme. We believe that investors who were steered into these “leveraged” investments may have grounds to fight back against bank demands for repayment.

The Scheme: A “Business” Built on Ghosts

The Prestige Funds, alongside Paramount Management Group, sold private-placement investments in the ATM industry. They promised investors:

• Fixed monthly payments (often representing a 24% annual return).
• Significant tax benefits via ATM depreciation.
• Direct ownership of the ATM machines.

The reality was far darker. Recent evidence and employee admissions suggest that while the Prestige Funds claimed to operate over 38,000 ATMs, they actually owned as few as 8,000—most of which generated little to no revenue. Investor funds were not being used to grow a business; they were allegedly being used to pay back earlier investors or were misappropriated for personal gain.

The Bank’s Role: Financing the Fraud

Our investigation focuses on the “ATM loan programs” designed by banks specifically to facilitate these investments. In some cases, a bank acted as the financing arm for the scheme.

We are pursuing the theory that banks may be liable to investors for:

• Failure of Due Diligence: Banks are required by the Bank Secrecy Act (BSA) and OCC Safety and Soundness Standards to verify collateral. If banks had verified the existence of the ATMs, the scheme might have been uncovered years ago.
• Fraudulent Security Interests: Some banks claimed to hold “Purchase Money Security Interests” (PMSI) in the ATMs. However, legally, a PMSI typically requires the debtor to actually possess the collateral. Since the ATMs were part of a passive investment managed by Prestige, these security interests may have been invalid.
• Knowledge of Red Flags: In some instances, bank officers were allegedly involved in multiple similar schemes simultaneously, including Water Station Technology and CETA.

The “Double Victimization” of Investors

When the Prestige Funds collapsed in early 2024, the banks stopped receiving payments from the scheme. Rather than acknowledging their own lack of oversight, some banks have begun mass-filing collection actions against the very investors they helped recruit into the scam.

We Want to Hear From You

If you took out a loan to invest in the Prestige Funds or Paramount, you should not have to face the bank alone. We are investigating claims that banks may have violated the Washington State Securities Act and the Consumer Protection Act by selling these intertwined loan and investment products.

Contact us today if:

1. You invested in the Prestige Funds or Paramount Management Group.
2. A bank provided you with a “specialty” loan to fund that investment.
3. You are now being asked to pay back a loan for ATMs that may never have existed.

On February 2, 2026, the Scottsdale-based private equity firm specializing in senior housing filed for Chapter 11 bankruptcy protection in the Northern District of Texas, alongside over 160 affiliated entities. The filing listed estimated liabilities between $1 billion and $10 billion.

While IHC frames this as a “strategic restructuring,” history tells us that in complex private equity bankruptcies, equity investors and unsecured creditors often face substantial, if not total, losses.

However, the bankruptcy of IHC is not necessarily the end of the road for investors seeking recovery. If you purchased IHC investments through a brokerage firm or a registered financial advisor, your losses may be the result of broker misconduct, negligence, or a failure to conduct adequate due diligence.

Our firm is currently investigating claims on behalf of investors against the broker-dealers who sold these high-risk products.

The Warning Signs Were Ignored

The collapse of IHC did not happen overnight. The bankruptcy filing was the culmination of months of severe red flags that financial professionals should have been monitoring. For example, industry reports indicated that prior to the collapse, only a fraction of IHC’s 35 senior living properties were performing as projected. Despite the inherent risks of private equity in the volatile healthcare real estate sector, many brokers continued to market IHC products until the bitter end.

Other concerning developments regarding IHC include:

• July 2025 Suspension: IHC abruptly suspended monthly distributions to investors and halted new investment offerings, citing ongoing scrutiny by the Securities and Exchange Commission (SEC).
• Operational Failure: The company shut down its internal management arm, Volante Senior Living, admitting it could not effectively run the properties it owned.
• Leadership Purge: In late 2025, founder and CEO Luke Lee was removed amid allegations of misrepresentation regarding corporate debt and personal guarantees.

Was This Investment “Suitable” for You?

Inspired Healthcare Capital raised massive amounts of money through Regulation D private placements and Delaware Statutory Trusts (DSTs). These are alternative investments. They are complex, illiquid (you cannot easily sell them), lack transparency compared to publicly traded stocks, and carry a high risk of total loss.

These investments often pay high commissions to the brokers who sell them, creating a potential conflict of interest.

Under securities laws and FINRA rules (including Regulation Best Interest), a financial advisor has a strict legal duty to:

1. Conduct Due Diligence: The brokerage firm must independently investigate the product to ensure it is legitimate and that the sponsor’s claims are realistic. Did your broker investigate IHC’s massive debt loads or the actual performance of their senior care facilities?
2. Determine Suitability: The advisor must ensure the investment matches your financial goals, risk tolerance, age, and liquidity needs.

If you are a conservative investor, a retiree relying on your portfolio for living expenses, or someone who cannot afford to lose their principal, high-risk private placements like IHC were likely unsuitable for you.

If your advisor pitched IHC as a “safe,” “guaranteed,” or “bond-like” income stream, they may have misrepresented the risks and violated their duty to you.

FINRA Arbitration

Investors in IHC generally cannot sue their advisor in regular court due to the contracts they signed when opening their brokerage accounts. Instead, these disputes must be resolved through FINRA Arbitration.

FINRA (Financial Industry Regulatory Authority) operates the forum where disputes between investors and brokers are decided.

• It is not a class action. FINRA arbitration is an individual claim focused specifically on the conversations you had with your advisor and your unique financial situation.
• It is private and often faster than traditional litigation.
• The goal is rescission or damages. The objective is to put you back in the financial position you would have been in had you never been sold the unsuitable investment.

How We Can Help

When a sponsor like Inspired Healthcare Capital files for bankruptcy, they essentially admit they have no money left to pay investors. Pursuing the bankrupt entity is often fruitless.

Our firm focuses on holding the solvent parties accountable: the brokerage firms that failed to protect their clients. Broker-dealers may have assets to satisfy arbitration awards.

We are currently offering free, confidential consultations to investors who purchased Inspired Healthcare Capital products. During this consultation, we will review:

• How the investment was presented to you.
• Your stated risk tolerance and investment objectives at the time of sale.
• Whether your brokerage firm conducted adequate due diligence on IHC.

We typically handle these cases on a contingency fee basis, meaning we only get paid if we successfully recover money for you.

Time is Limited

If you have suffered losses in Inspired Healthcare Capital, do not wait to act. There may be time limitations that apply to filing FINRA arbitration claims. The bankruptcy court proceedings will not pause these deadlines.

Contact Nico Banks today at 971-678-0036 or email nico@bankslawoffice.com to discuss your options for recovery. You can also fill out our contact form.

Prestige Funds raised money from investors purportedly to purchase ATM machines that would be managed and operated by Prestige’s affiliate, Paramount Management Group. Investors were promised handsome profits in exchange.

Unfortunately, instead of using the money raised from investors to purchase and operate ATMs, Prestige and Paramount operated a Ponzi scheme. That is, they used money raised from investors to pay back old investors, instead of investing legitimately in ATMs or ATM-management services.

The scheme has now collapsed, and the FBI raided Paramount.

Prestige Funds’ And Paramount Management Group’s Fraudulent Scheme

Prestige Funds purported to own a network of ATMs. It raised money, at least in part, through private-placement securities sold under “Regulation D.” Because they investments were private placements, they could only be sold to certain sophisticated and/or wealthy investors, and they were not traded on any public exchange like the New York Stock Exchange.

Investors who purchased the securities issued by Prestige were promised returns from the profits generated by the network of ATMs. According to Prestige, it had approximately 2,700 investors.

Prestige purportedly outsourced the management of the ATMs to qualified management companies with “ATM Management Agreements.” Paramount Management Group was one of those management companies.

Pursuant to the ATM Management Agreements, Paramount Management Group would collect the profits that the ATMs generated and make fixed monthly payments to the Prestige Funds.

Notably, Paramount and Prestige are both owned and operated by an individual named Daryl Heller. Because of the common ownership and control, Banks Law Office suspects that Paramount Management Group and Prestige may have colluded with each other to defraud Prestige’s investors.

Prestige Funds Sued Paramount Management Group

In August of 2024, various entities with the suffix “Prestige Fund” (and a few other similar entities with the suffix “WF Velocity”) filed a lawsuit in Lancaster, Pennsylvania against Paramount Management Group, LLC. The lawsuit alleged that Paramount Management Group owed the Prestige Funds monthly payments pursuant to the ATM Management Agreements discussed above.

As noted above, Daryl Heller was the majority owner of Prestige. And in September of 2024, Heller authorized attorneys to withdraw Prestige Funds’ lawsuit against Paramount Management Group (which was also owned by Heller).

Minority owners of Prestige then asked the court to not allow the withdrawal of Prestige’s lawsuit against Paramount.

Paramount Failed To Comply With A Court Order To Identify ATMs

Ultimately, on November 21, 2024, Paramount Management Group, LLC entered into a consent order to pay Prestige $138,156,118.38 in missing payments. On the same day, the court ordered Paramount to supply Prestige with a complete inventory of all ATM units within two days, and to transfer to Prestige within seven days all ownership rights in the ATM units.

Paramount did not comply with the court’s order. Prestige then asked the court to impose sanctions on Paramount for failing to comply with the order, and the court did so. Paramount, however, failed to comply with that court order.

The FBI Raided Paramount Management Group

In December of 2024, the FBI raided an entity responsible for perpetrating the Ponzi scheme, Paramount Management Group, which was owned by Daryl Heller.

Daryl Heller appeared at a court hearing on December 21, 2024 and invoked his Fifth Amendment right not to incriminate himself, suggesting that he is worried about being criminally prosecuted for perpetrating a Ponzi scheme.

Paramount Still Has Not Complied With The Court’s Orders

On December 29, 2024, Paramount filed a brief with the court indicating that it would not be able to comply with the court’s order, including the order to supply information about ATMs it owns.

Paramount stated in the brief that on December 13, 2024, it laid off all of its employees, suggesting that it is now longer in business.

In the brief, Paramount stated that thousands of the ATMs were stored in a warehouse in Lancaster, Pennsylvania, and that Prestige was aware of that arrangement. If that statement is true, it shows that Prestige defrauded its investors because Prestige did not tell its investors that thousands of the ATMs it owned were being stored in a warehouse instead of operated.

The brief also concedes that Paramount does not have access to information for many of the 38,000 ATMs it was purportedly managing for Prestige, which is another obvious indication of fraud.

Victims Should Contact Banks Law Office

Banks Law Office requests that anybody who invested in Prestige reach out to us. We are interested to learn any information you can provide, and we would be happy to share with you what we know. You can reach us at info@bankslawoffice.com or at 971-678-0036.

Specifically, Madden and Grabow allegedly took more than $23 million from more than 200 investors.

Madden and Grabow allegedly told investors that Savitar was working with various partners on a large casino and resort project in Mexico that would generate high returns. But, in reality, Savitar lacked any legitimate business operations. Savitar simply diverted new investors’ money to pay back old investors and to enrich Madden and Grabow.

If you believe you were a victim of this Ponzi scheme, we encourage you to contact our office immediately.

For years, non-traded real estate investment trusts (REITs) like KBS REIT III have been marketed as attractive investment opportunities. With promises of steady income and access to high-quality commercial real estate, these vehicles have drawn significant interest from investors seeking diversification and reliable returns. However, many investors have faced unexpected challenges, including substantial losses, illiquidity, and declining asset values. Recent reports of a decline in the value of KBS REIT III highlight the importance of understanding the risks associated with non-traded REITs and taking action to protect your investment.

Declining Value of KBS REIT III

In recent years, KBS REIT III has experienced a significant drop in value, leaving many investors concerned about their financial futures. Originally launched in 2010 with a price of $10 per share, the REIT’s current valuation has fallen well below this level. Some reports indicate that that REIT may now be worth approximately $1 per share.

Such declines can be attributed to various factors, including changes in the commercial real estate market, interest rate fluctuations, and management decisions that may not align with the best interests of shareholders. For instance, non-traded REITs like KBS REIT III often carry higher fees and expenses compared to publicly traded REITs. These costs can erode returns over time, even in favorable market conditions. Furthermore, non-traded REITs are inherently illiquid, meaning that investors cannot easily sell their shares on a secondary market. This lack of liquidity compounds the financial strain when the value of the investment declines.

The Risks of Non-Traded REITs

KBS REIT III exemplifies many of the risks associated with non-traded REITs, including:

1. Illiquidity: Investors are often locked into these investments for extended periods, unable to access their funds when needed.
2. High Fees: Upfront fees, management fees, and other costs can significantly reduce overall returns.
3. Lack of Transparency: Non-traded REITs may provide limited information about their financial health, making it difficult for investors to assess performance accurately.
4. Market Volatility: While non-traded REITs are less correlated with stock market volatility, they are still subject to fluctuations in real estate values and interest rates.
5. Overreliance on Distributions: Many non-traded REITs distribute dividends from borrowed funds or capital rather than income, which can mask underlying financial weaknesses.

What Can Investors Do?

If you have invested in KBS REIT III and are concerned about its declining value or your ability to recover your investment, it is essential to take proactive steps. While the risks of non-traded REITs are often disclosed in offering documents, investors may not have been fully informed about the implications of these risks at the time of sale. In some cases, financial advisors or brokerage firms may have failed to act in the best interests of their clients, recommending non-traded REITs to investors for whom these products were unsuitable.

Speak to an Investment Litigation Attorney

Investors who have suffered losses in KBS REIT III may have legal options to recover their funds. As an investment litigation attorney, I have seen firsthand how improper sales practices and inadequate disclosure can lead to significant financial harm. If you believe your advisor misrepresented the risks of KBS REIT III or recommended it without considering your financial goals and risk tolerance, you may be entitled to compensation.

Our firm specializes in representing investors in disputes involving non-traded REITs, including KBS REIT III. We can help you assess your case, identify potential claims, and pursue recovery through arbitration, mediation, or litigation.

Brighton Jones’ contracts indicated that the asset-management fees would be calculated as a percentage of the investor’s “investable net worth.” Banks Law Office believes that many Brighton Jones advisors interpreted the contract to mean that it should charge asset-management fees by multiplying their fee percentage (for example, a 1% annual fee) by the total of all of their clients’ investable assets, rather than only assets that the client had asked Brighton Jones to manage. As a result, Brighton Jones may have charged the clients fees for managing assets that Brighton Jones had no authority to manage. The practice would have been violated state and federal law.

Investors are encouraged to contact Banks Law Office as soon as possible to explore recovery options.

Camenisch v. Umpqua Bank

Camenisch v. Umpqua Bank is a case brought by alleged victims of a Ponzi scheme carried out by Ken Casey through two companies he controlled: Professional Financial Investors, Inc. and Professional Investors Security Fund. The investors sued Umpqua Bank, which was the financial institution that handled all of the alleged Ponzi scheme’s bank accounts.

In their complaint, the investors alleged that circumstantial evidence demonstrated that Umpqua Bank knew that the bank accounts it handled were being used to perpetrate a Ponzi scheme. That circumstantial evidence included:

• Before opening the bank accounts at issue, Ken Casey had pled guilty to numerous counts of financial fraud in a different fraudulent scheme that he had run.
• Ken Casey personally kept close control over PFI and PISF bank accounts, which was unusual given that the accounts were very large; they accepted and transferred hundreds of millions of dollars.
• The bank account statements showed that money deposited from new investors was being comingled with other investors’ funds, which were being used to pay existing investors, and were being used to pay Casey’s personal expenses.

Umpqua Bank filed a motion to dismiss, arguing that the allegations in the complaint were not sufficient to show that Umpqua Bank knew that the accounts at issue were being used to perpetrate a Ponzi scheme. The court denied the motion to dismiss but noted that the question “may be somewhat close.”

After discovery was completed, Umpqua Bank filed a motion for summary judgment, contending that Plaintiffs did not have evidence sufficient to support their claims. The court denied the motion for summary judgment and detailed a plethora of evidence that Plaintiffs had cited in opposition to the motion for summary judgment. For example, Plaintiffs showed that Umpqua’s automated system generated more than 100 red flags for the accounts at issue, which would have prompted Umpqua to review the activity and see that money raised from new investors was being used to pay back previous investors. Moreover, a banker at Umpqua transferred money between the Ponzi scheme’s different accounts on her own initiative to cover short falls. That banker’s written messages to other Umpqua employees also suggested she knew of fishy activity in the accounts.

The case is set for trial in February of 2025.

In re Woodbridge

Woodbridge was a fraudulent enterprise that raised $1.2 billion in real estate investments while running a Ponzi scheme. Comercia handled the bank accounts for Woodbridge. Plaintiffs claimed that Comercia processed over 10,000 internal transfers totaling $1.6 billion among related Woodbridge accounts and hundreds of millions of dollars in transfers to vaguely denominated attorney trust accounts.

Comercia moved to dismiss the aiding and abetting claims. The court denied the motion. The court noted that plaintiffs’ allegations of Comercia’s “close business relationship with Shapiro, its awareness of banking activity inconsistent with Woodbridge’s stated business model, and Shapiro’s disbursements and personal expenditures from investors funds” and that “a bank’s decision to ignore suspicious activity or red flags is sufficient to demonstrate actual knowledge” under California law.

The case settled for $54.2 million. In the motion to the court for approval of the settlement class, the plaintiffs stated that they estimated the damages were “as high as $500 million or more,” so the settlement recovery represented “at least 10% of best-case scenario damages” and “a much higher percentage of plausibly recoverable damages.”

In re Silvergate (FTX)

Silvergate is a bank that operated a “Silvergate Exchange Network” that allegedly facilitated the famous FTX cryptocurrency Ponzi scheme run by Sam Bankman-Fried. Specifically, Silvergate created a payment network that allowed participants to send money instantly to other network participants at any time, in part by eliminating the due diligence time built into traditional bank transfers. The network allowed FTX’s customers to trade fiat currency for crypto and vice-versa nearly instantaneously.

The FTX Ponzi scheme operated several bank accounts at Silvergate and used Silvergate’s payment network. Some of those accounts accepted money from FTX’s customers. When FTX’s customers were deposited into FTX’s accounts, FTX credited FTX customer accounts with e-money corresponding to the amount on FTX’s internal ledger system even though the money remained in FTX’s own accounts.

Silvergate moved to dismiss the complaint, and the court denied the motion, finding that the investors had adequately pleaded that Silvergate had actual knowledge of the FTX fraud. Silvergate argued that the investors had only pleaded that there were red flags in the FTX bank accounts, rather than adequately pleading that Silvergate had actual knowledge of the fraud.

The court disagreed and noted that “the Ninth Circuit has suggested that a bank’s decision to ignore suspicious activity or red flags is sufficient to demonstrate actual knowledge.”

Chang v. Wells Fargo Bank

A Ponzi scheme called Equitybuild solicited investors by promising them returns generated by investments in real estate investment programs. It then used the money it raised to improperly pay back previous investors and siphon the money to its principals, while only using a small fraction of the money for any legitimate operations. Investors brought a putative class action against Wells Fargo, which operated the bank accounts for Equitbuild.

Wells Fargo moved to dismiss the claims, arguing that the investors had not adequately alleged that Wells Fargo had actual knowledge of the Ponzi scheme. The court denied the motion to dismiss. The court noted that, according to Plaintiffs’ allegations Wells Fargo had manually processed a number of wires that on their face indicated that they deposited investors proceeds in the Equitybuild accounts maintained by Wells Fargo. Moreover, the account statements reflected that the investor proceeds were used to make payments to Equitybuild’s principals and pay for their living expenses.

The case later settled for $3.75 million after the parties had engaged in extensive discovery, and the defendant maintained that there was “no evidence” for Plaintiffs’ allegations. $3.75 million represented 3.75 percent of the $100 million of the investors’ estimated total possible recovery.

Nielson v. Union Bank of California

In Nielson, the plaintiffs alleged that the defendant bank (Union Bank of California) knew that their customer was engaged in fraud and nevertheless breached its fiduciary duty to its customers, the plaintiffs.

Union Bank of California moved to dismiss the complaint, arguing that the plaintiffs had failed to allege the bank had actual knowledge of the fraudulent scheme. In denying the motion to dismiss, the court stated: “The complaint details the manner in which the Ponzi scheme operated, describes Slatkin’s fraudulent transactions, and outlines the Banks’ involvement in these activities. It alleges, in particular, that the Banks utilized atypical banking procedures to service Slatkin’s accounts, raising an inference that they knew of the Ponzi scheme and sought to accommodate it by altering their normal ways of doing business. This supports the general allegations of knowledge.”

As most L-Bond holders know, GWG entered “Chapter 11 bankruptcy” in 2021. That means GWG admitted that it would probably not be able to pay its debts.

The bankruptcy allowed GWG to “restructure” its debts to L-Bond holders. As a result, GWG is no longer promising to pay L-Bond investors their initial investments back, let alone any interest. As a sort of consolation prize, GWG gave L-Bond investors rights to other assets (in particular, L-Bond investors are entitled to the value of those assets up to the point where the L-Bond investors receive back what they’re owed). GWG summarized the assets it gave to L-Bond investors in the following table:

GWG’s “Summary” was meant to give some hope to Bondholders: its bottom line says that Bondholders could recover up to 100% of what they were owed (although it concedes they could also recover as little as 9%).

The chart estimates that L-Bond investors could expect to receive up to $1.428 billion from their “interests in Beneficient” (Beneficient, which I’ll call “BEN,” is a small startup company that I’ll discuss in more detail in the next section of this blog post). But as of January 3, 2025, L-Bond investors’ interests in BEN are worth less than $125 million.

I am not merely speculating that L-Bond investors’ interests in BEN are worth less than $125 million. It is indisputable. That is because after GWG published the chart above, BEN became a publicly traded company. As a result, BEN’s value can easily be measured by its stock’s trading price.

You can track BEN’s value yourself by googling its stock ticker, “BENF.” L-Bond investors’ interests in BEN are worth less than the BENF current stock price (which, as of 1/3/2025, is $0.72) multiplied by 170 million (because L-bond investors have fewer than 170 million shares).

Given that L-Bond investors’ interests in BEN are worth less than $125 million, some simple arithmetic shown below demonstrates that L-Bond holders will probably get back only a small fraction of what they were owed.

Specifically, L-Bond holders are collectively owed $1.6 billion. The chart above shows that they would likely be paid what they are owed if their interests in BEN were worth $1.428 billion. Their interests in BEN are actually only worth less than $0.125 billion, which creates a $1.40 billion shortfall. That shortfall alone is more than 90 percent of what L-Bond investors were owed, which is a very bad sign for L-Bond investors.

Moreover, the chart above estimates that L-Bond holders’ ownership interests in the “Life Policy Portfolio” (that is, the life insurance policies that GWG purchased while it was operating) was up to $78 million. But after the chart was published, the trustee sold the life insurance portfolio for approximately $10 million.

Furthermore, the judge in the bankruptcy case stated about GWG L-Bonds, in October of 2023, that he believed that L Bondholders would lose a very large percentage of their investments.

The rest of this blog post describes the history of GWG L-Bonds to attempt to explain why brokers knew or should have known that it was inevitable that L-Bondholders would lose money.

GWG’s Original Business Was Raising Money With L-Bonds And Investing In Life Insurance Policies

For most of its existence, GWG invested in life insurance policies. Specifically, if a person held a life insurance policy and needed money immediately, he or she could sell the life insurance policy to GWG for a lump-sum payment. GWG then paid premiums on that life insurance policy until the person died, at which time GWG could collect the death benefit.

GWG raised money for its business mostly by selling L-bonds to retail investors. L-bonds, like other bonds, were like an “IOU.” That is, the L-Bond investor agreed to loan money to GWG, and in exchange, GWG agreed to pay the investor interest every year before returning the investor’s principal after a set number of years.

Since They Were First Issued In 2012, L-Bonds Have Been Very Risky And Illiquid

GWG began selling what it called “Renewable Secured Debentures” (which it would later re-name “L-Bonds”) in 2012. From the beginning, they were very risk and illiquid securities. Their offering documents even admitted that they may be considered “speculative” and “high risk.”

As explained in more detail under the next header, the main reason that L-Bonds/debentures were very risky and speculative is because GWG itself was always a failing business that never made a profit.

However, separate and apart from GWG’s shortcomings as a company, L-Bonds had very risky characteristics as a financial instrument. First, unlike most public reporting securities, L-Bonds were illiquid. That means they did not trade on any public market, so there was no public trading price to track their value. Unfortunately, many broker-dealers told investors took advantage of GWG’s lack of a transparent public trading price by telling retail-investors, falsely, that an L-Bond’s value was stable and unchanging. The reality was that an L-Bond’s value was often declining in value; the decline was just invisible because of the lack of a trading price.

Another risky characteristic of an L-Bond was that they were not directly secured by the life insurance policies that constituted a majority of GWG’s assets. GWG’s life insurance policies had been pledged as collateral for a different line of credit used by GWG. Therefore, in the event GWG defaulted on the L-Bonds (as, of course, it eventually did), L-Bond holders would not have necessarily be able to get their money back by liquidating GWG’s assets. GWG’s other creditors would have the first-priority claims.

Because of L-Bonds/debentures’ risky and speculative nature, FINRA disciplined broker-dealers who sold these high-risk securities to elderly or conservative investors, even if the broker-dealers disclosed the risks.

GWG Was Doomed Because It Omitted Key Costs From Its Financial Projections And Paid Enormous Commissions To L-Bond Sellers

From the beginning of its existence, GWG inflated its own profitability projections by omitting key costs from those projections. In fact, the only costs GWG included in its projections were the acquisition cost of the policies and premium payments.

In other words, GWG assumed it would pay zero dollars for basic expenses like operating expenses and financing costs. That was obviously not a realistic assumption.

Not only did GWG understate its expected costs, but it also overstated the revenue it could expect to collect from its life insurance policies maturing. GWG even admitted that it had overstated its expected revenue in its 2018 Form 10-K. In particular, GWG cited unreliable mortality studies (rather than standard life-expectancy tables), which allowed GWG to underestimate the life expectancy of the people its life-insurance policies were tied to, which inflated GWG’s expected revenue.

Because GWG vastly understated its projected costs and overstated its expected revenue, it is not surprising that GWG lost money every year. By the end of 2018, GWG was $300 million insolvent.

To make matters worse, selling the L Bond—GWG’s primary source of cash for acquiring additional life insurance policies (and paying premiums on existing policies)—became exceedingly expensive for GWG. Indeed, after April 2018, GWG paid its top 12 broker-dealers more than $42 million in commissions alone to sell L-bonds.

Those enormous commissions paid to brokers, which sometimes reached an astonishing 8 percent of the price of the sold L-Bonds, harmed retail investors in two ways. First, as discussed above, the high commissions were a large cost for GWG that lead to its insolvency. Second, the commissions gave perverse incentives to brokers to sell L-Bonds to investors even though it was not in the investors’ interests.

GWG L-Bonds Were A Ponzi Scheme

GWG was a Ponzi scheme, meaning that it continued a cycle of (1) borrowing money by selling L-Bonds; (2) losing the borrowed money in its failed business operations; and then (3) borrowing more money to pay back its bondholders. Every time this cycle repeated itself, GWG had to borrow more money, and the cycle was bound to collapse.

The more L-Bonds GWG sold, the more cash it needed to make interest and maturity payments on L-Bonds. Because GWG’s life insurance portfolio failed to generate enough cash to even cover the servicing costs of L-Bonds, GWG opted to double-down and simply sell more L-Bonds. Therefore, GWG incurred more and more debt, just to pay its old investors and avoid defaulting on its existing obligations.

That is how L-Bonds became a classic Ponzi scheme in which new L-Bonds needed to be sold in order to generate proceeds to pay the interest and principal obligations on existing L-Bonds.

Notably, GWG admitted, even in its early L-Bond/debenture offering documents that it was relying on future L-Bond sales to pay back current L-Bond investors.

Because GWG’s existence depended on its ability to keep selling L-Bonds, GWG went to great lengths to sell the L-Bonds, including misleading L-Bond purchasers. For example, according to FINRA enforcement, some GWG-created sales kits included brochures that inaccurately implied that L-Bonds/debentures were secured by $489 million of life insurance policies. The reality was that, as discussed above, life insurance policies had actually been pledged to secure other GWG creditors’ loans. Moreover, the $489 million value was the face value of the benefits of the policies and not their current value, a significantly lower number.

Brad Heppner And His Startup Beneficent Took Over The GWG L-Bonds Ponzi Scheme

Brad Heppner owned BEN, which was a highly speculative startup. BEN focused on a supposedly untapped market: offering liquidity solutions to wealthy individuals and institutions holding illiquid assets. However, BEN’s theoretical business model faced a number of challenges, including whether this market even existed.

Moreover, all BEN had was this untested idea. It lacked what GWG had to offer: a ready stream of cash.

Heppner/BEN wanted to co-opt GWG’s L-Bonds Ponzi-scheme so that BEN would have a source of cash flow.  So that’s what they did. Beginning in January of 2018, Heppner and BEN took over GWG in a series of illegal insider transactions.

It is indisputable that BEN did not pay GWG fair compensation for acquiring GWG interests. Instead, BEN insiders (mostly Heppner) benefitted at the expense of GWG stakeholders like L-Bond investors. The insiders attempted to cover up GWG’s illegal acquisition of GWG by overstating BEN’s value (in particular, they overstated BEN’s “goodwill,” meaning its intangible value).

Then, beginning in June 2019, Heppner and BEN used their unlawfully acquired control over GWG to re-direct GWG’s L-Bonds proceeds away from purchasing life insurance and towards funding Ben’s unproven operations.

Actually, Heppner and BEN didn’t just redirect the proceeds to Ben’s operations. Shortly after Heppner and BEN began re-directing GWG’s L-Bonds proceeds to Heppner/Ben, Tiffany Kice, Beneficient’s chief financial officer, discovered that millions of dollars were being redirected into Heppner’s pocket.

For example, Heppner used the L-Bonds proceeds to “pay himself back” for his own investments he had made in the company to make sure he wouldn’t lose money if BEN failed. According to the Wall Street Journal, BEN also used L-Bond proceeds to pay Heppner for “ranch-related business activities,” which were later listed as “discontinued operations.” The “ranch activities” appeared to be used almost entirely for the benefit of Heppner’s family, friends, and business associates.

The Wall Street Journal also reported that BEN paid Heppner over $20 million to purchase a technology company that owned assets more than a decade old, and the technology company’s assets were soon written off.

As an aside, many people who were sold L-Bonds after 2018 did not even realize that they were investing in BEN. For example, the SEC charged a brokerage firm with violating Regulation Best Interest partly because its brokers sold L-Bonds in 2020 without any awareness of Ben.

If a brokerage firm sold an investor L-Bond after 2018 (or renewed an L-Bond an investor had previously purchased) and neglected to tell the investor that L Bonds were investing in Ben, then the brokerage firm probably committed fraud.

The L-Bonds Ponzi Scheme Collapsed After Auditors And Board Members Resigned, And The SEC Began Investigating GWG

GWG/BEN tried to cover up their L-Bonds Ponzi scheme, and BEN’s illegal acquisition of GWG, with accounting shenanigans. For example, as noted above, they overstated BEN’s “goodwill.” Moreover, according to the Wall Street Journal, BEN made loans to its own subsidiaries and counted the interest and fees it got back as revenue, which created the false appearance that BEN was generating revenue growth when in fact BEN’s assets were actually incurring losses.

Those accounting shenanigans created the false appearance that (1) GWG/BEN had enough assets to pay back L-Bond holders, and (2) BEN had paid a fair value (and thus legally acquired) GWG.

The accounting shenanigans became so bad that, after 2018, all of GWG’s auditors resigned or declined to seek reappointment after less than a year. So, it is not surprising that GWG failed to timely file its 2020 annual report and its quarterly report for the first quarter of 2021.

Moreover, in August of 2019, three GWG Board members raised concerns to GWG management about GWG and its relationship with BEN. When Heppner, Ben, and the rest of GWG refused to address those concerns, all three of the Directors resigned their positions in October 2019.

In March 2020, BEN added Murray Devine to a “Special Committee” on GWG’s Board that was supposed to be composed solely of Directors that were not affiliated with BEN. BEN falsely stated that Devine was “disinterested and independent” from BEN. That was obviously false; Devine was on the Board of Ben.

Incredibly, broker-dealers continued to sell L-Bonds despite all these red flags.

The Securities and Exchange Commission, however, commenced an investigation. Once the investigation became public, GWG could no longer sell new L-Bonds to pay back existing L-Bondholders. The Ponzi scheme, therefore, collapsed.

Many Brokerage Firms That Sold GWG L-Bonds Have Exhausted Their Assets Paying Claims Brought By GWG L-Bond Holders

Many L-Bond purchasers have sued the broker-dealer firms that sold them GWG L-Bonds. The claims have largely been successful.

For example, Banks Law Office’s attorney Nico Banks represented GWG L-Bond purchasers and won a $1.3 million FINRA arbitration award against Larry Richard Law, the former owner of JRL Capital Corporation (a now defunct entity).

In fact, the claims have been so successful that they have forced many GWG L-Bond sellers into bankruptcy or otherwise out of business. JRL Capital Corporation was one of those entities. Emerson Equities may be another now that it has exhausted its insurance policy related to GWG L-Bonds

Because these claims are forcing broker-dealers into bankruptcy, it is important that GWG L-Bond investors bring claims against broker-dealers soon.

FINRA Takes Action Against Sellers Of GWG L-Bonds In 2024

FINRA has disciplined several entities and individuals who were responsible for selling GWG L-Bonds.

For example, in November of 2024, FINRA issued a letter of acceptance, waiver, and consent (“AWC”) alleging that Blaine R. Stahlman, a General Securities Principal, failed to supervise his subordinates’ sales of GWG L-Bonds. Stahlman was the founder, CEO, and Chief Compliance Office of Professional Broker-Dealer Financial Planning, Inc. (“PBD”).

FINRA found that the sales of L-Bonds at issue violated Regulation Best Interest because purchasing L-Bonds was not in the customer’s best interests. The L-Bonds represented between 11 percent and 32 percent of the customers’ net worth, and three of the customers were seniors.

Likewise, in November of 2024, FINRA issued another AWC in which it found that Linda Wimsatt violated regulation best interest by recommending that investors invest more than 10% of their net worth in GWG L-Bonds, particularly when the investors had only moderate risk tolerances.

In August of 2024, FINRA issued another AWC in which it found that Kyle Chapman violated regulation best interest by failing to conduct a reasonable review of the GWG L-Bonds offering documents and failing to understand the risks related to L-Bonds before selling them to his clients. For example, Chapman failed to understand that, in the event GWG defaulted, bondholders’ ability to enforce their rights to payment would be restricted. Likewise, Chapman failed to understand that the “diversification” caused by GWG’s change in business model in 2018 and 2019 would reduce the risks associated with the investment. The AWC stated that “this change in business model increased the risks associated with investment in GWG L Bonds, in part because L Bonds were no longer fully backed by life insurance policies.”

If You Invested In GWG L-Bonds, You Should Contact An Attorney

Your best option to recover your investment in L-Bonds is probably to hire an attorney to represent you on a contingency fee basis. A “contingency fee” means that you will never pay anything out of pocket for their services. The attorney will just keep a percentage of what they can recover for you.

The attorneys at Banks Law Office have experience representing investors in GWG L-Bonds. Please contact us at 971-678-0036 or info@bankslawoffice.com.

The Commodity Futures Trading Commission announced a civil enforcement action alleging that SimTradePro Inc. defrauded more than 100 U.S. customers out of at least $2.3 million. SimTrade Pro Inc. allegedly acted as an unregistered commodity trading advisor.

SimTradePro allegedly operated from at least February 2018 to April 2019. It allegely charged introducing broker fees that were not disclosed to the investors.

If you invested in SimTradePro Inc., it may be in your interests to speak to Oregon securities attorneys, who may be able to help you recover part or all of your investment.

From at least November 2019 until the time the CFTC filed the lawsuit, TD and its principals — including Joseph Safranko (a.k.a. Ted Safrank) and David William Negus — operated the Ponzi scheme. It was a multi-layered scheme. They used other individuals and entities (sponsors), with each sponsor acting like a spoke extending from the TD hub.

The other defendants in the case include: Ares Global (a.k.a. “Trubluefx”), Algo Capital LLC, Algo FX Capital Advisor (a.k.a. “Quant5 Advisor LLC”), Robert Collazo Jr., Juan Jose Herman, Stephen Likos, Michael Shannon Sims, Holton Buggs Jr., Centurion Capital Group, Alejandro Santiestaban (a.k.a. Alex Santi), Gabriel Beltran, and Archie Rice.

The Court issued a statutory restraining order against the defendants, freezing their assets and giving the CFTC immediate access to their books and records.

If you purchased investments in Traders Domain or its affiliates, it may be in your interests to speak to an attorney about your options to recover some or all of your investment losses.

Banks Law Office filed a motion to amend the complaint. The defendants in the “proposed second amended complaint” include Marker Law, Bank of America, Wells Fargo, and First Citizens Bank. A summary of the proposed second amended complaint is below.

Summary of Proposed Second Amended Complaint

Wealth Assistants is a fraudulent scheme perpetrated by the Day family: Max K. Day, Max O. Day, Michael Day, and Jared Day. They are career criminals who have perpetrated similar schemes for decades, stealing hundreds of millions of dollars from their victims.

Wealth Assistants obtained more than $50 million by defrauding more than 600 individuals.

Specifically, Wealth Assistants advertised that it would provide its clients with substantial income by setting up and managing lucrative online Amazon stores that the clients would own. But Wealth Assistants did not provide the promised services. Instead, it used the fees it collected from Plaintiffs and its other clients for the benefit of the Human Defendants.

Wealth Assistants’ clients would pay it an upfront fee of up to $125,000 to set up an online Amazon store in the client’s name and manage it. After that, the client would pay for the store’s inventory, along with certain other smaller fees. In return, the individual would be entitled to collect between 50 percent and 70 percent of the online store’s gross profits.

Wealth Assistants advertised that the profits of an online store it managed should grow to more than $10,000 per month by the end of the store’s first year.

Hundreds of individuals purchased the business opportunity Wealth Assistants offered. Most of these purchasers were middle class, and many had to use all their retirement savings or take out home equity loans to make the purchase.

Wealth Assistants never intended to follow through on its promises.

Some of Wealth Assistants’ clients never even received an online store after paying the fee. Others received stores (which themselves are valueless and can be easily and freely set up), but their stores were never stocked with any inventory. Others paid Wealth Assistants for inventory after receiving inventory invoices from Wealth Assistants that turned out to be fake; the inventory never actually appeared in their stores.

Ultimately, the vast majority of Wealth Assistants’ clients have received less than $10,000 in profits from their online stores, and many never received a single dollar of revenue from their stores (if they received stores at all).

Wealth Assistants perpetuated its fraudulent enterprise for as long as it could. When Plaintiffs and other individuals complained, Wealth Assistants invented excuses. It blamed “supply chain disruption,” for example. It asked its clients for patience.

Eventually, however, Plaintiffs and other individuals realized that they had been defrauded. Many of Wealth Assistants’ clients demanded their money back, complained to their banks, or alerted government agencies about the ongoing fraud.

Realizing that its fraud was being exposed, Wealth Assistants shut down. In October of 2023, Wealth Assistants announced to all of its clients that it was going out of business. The announcement told Plaintiffs that they would not receive further services and would not receive their money back.

Throughout this fraudulent scheme, instead of using the money collected from Wealth Assistants’ clients to provide the promised services, Wealth Assistants used much of the money it collected from its clients for the benefit of the Human Defendants. For example, Wealth Assistants’ CEO, Ryan Carroll, has flaunted his new Lamborghini.

Proficient Supply LLC is an entity that operated a scam nearly identical to Wealth Assistants’ scam beginning in 2020, before Wealth Assistants ever existed. Proficient Supply was shut down by the Federal Trade Commission in 2022, but a few months later, it was acquired by Wealth Assistants. Thereafter, as part of Wealth Assistants, it accepted payments from the Wealth Assistants Entity Defendants in transactions that served the sole purpose of helping Wealth Assistants conceal assets. Because of the intermingled assets, common ownership, and lack of distinct operations, Proficient Supply LLC is another alter ego of the Wealth Assistants Entity Defendants.

The Quantum-Wholesale Partnership Defendants—led by Defendants Troy Marchand and Bonnie Nichols—worked for Wealth Assistants and helped it carry out its fraudulent scheme. They also helped Wealth Assistants conceal its assets from Defendants by accepting fraudulent transfers totaling more than $1 million in the months before Wealth Assistants went out of business.

Defendant Travis Marker—acting through his two law offices, Defendant Law Office of Travis R. Marker and Defendant Parlay Law Group—served as an “escrow agent” to help Wealth Assistants conceal the proceeds of its fraudulent scheme. In particular, Travis Marker shipped credit card readers to many of Wealth Assistants’ clients for those clients to pay Wealth Assistants by making small discrete payments into different credit card readers. Those payments went to Travis Marker’s “escrow account,” and he would then pass those payments from the escrow accounts to undisclosed Wealth Assistants bank accounts, which helped prevent Plaintiffs from recovering the money that Wealth Assistants stole from them.

Defendant Bank of America operated bank accounts held by Wealth Assistants and Defendant Ryan Carroll. Bank of America quickly realized that Defendant Ryan Carroll was using those bank accounts to perpetrate a fraud because of blatant red flags, and in November of 2022, Bank of America froze some of those bank accounts. But instead of making efforts to return those funds to the individuals the funds had been stolen from, Bank of America simply wrote a cashier’s check to Wealth Assistants for more than $3.7 million so that it could conceal that money elsewhere. Even more egregiously, Bank of America continued operating many bank accounts held by Defendant Ryan Carroll after it had frozen Wealth Assistants’ accounts, and Bank of America continued helping Ryan Carroll conceal the proceeds of the Wealth Assistants fraudulent scheme.

Defendant Reyhan Pasinli is the owner and operator of Defendant Total Apps. Pasinli and Total Apps orchestrated Wealth Assistants’ Payment Processing Strategy (which, as explained below, aimed to conceal the proceeds of the fraudulent scheme and avoid money-laundering detection) by helping Wealth Assistants set up merchant bank accounts, recruiting other merchants to use their bank accounts in furtherance of Wealth Assistants’ Payment Processing Strategy, and serving as the “gateway” for transactions involving the various merchant accounts controlled by Wealth Assistants. Pasinli has long helped the Day family defendants conceal the proceeds of their various fraudulent schemes, and he knew that Wealth Assistants was a fraudulent scheme.

Total Apps is a registered independent sales organization of Wells Fargo Bank and, upon information and belief, Total Apps acted as Wells Fargo’s agent when it orchestrated Wealth Assistants’ Payment Processing Strategy. Therefore, Wells Fargo is vicariously liable for Total Apps’ participation in the fraudulent scheme.

Even if Total Apps were not associated with Wells Fargo, Wells Fargo would still be liable because it knowingly operated many Wealth Assistants bank accounts despite knowing of Wealth Assistants’ plan to fraudulently disperse its assets and conceal them from creditors.

First Citizens Bank knowingly operated a bank account for Providence Oak Properties, one of the Wealth Assistants Entity Defendants. First Citizens knew that the Providence Oak Properties bank account was being used for money laundering because—although Providence Oak Properties was purportedly a construction company—each of the wire transfers out of the Providence Oak Properties bank account explained that Providence Oak Properties was simply accepting transfers of cash and then wiring the cash back to the sender after deducting a fee. First Citizens Bank also did not keep records of the millions of dollars in transfers of money into the First Citizens Bank account.

The rise of electronic banking and digital payments has transformed the way we manage our finances, offering convenience and speed. However, it has also brought challenges, including the risk of unauthorized transactions and errors. Enter the Electronic Funds Transfer Act (EFTA), a federal law enacted in 1978 to protect consumers who engage in electronic funds transfers (EFTs), such as ATM transactions, debit card payments, and direct deposits.

As an attorney, understanding the EFTA and the civil claims it enables is essential for representing clients who have fallen victim to unauthorized electronic transactions or other violations of their rights under the Act.

Key Provisions of the EFTA

The EFTA establishes the rights, liabilities, and responsibilities of consumers and financial institutions regarding EFTs. Here are some of its key provisions:

1. Protection Against Unauthorized Transactions
   Consumers are shielded from the full financial impact of unauthorized transactions, provided they notify their financial institution within a specific timeframe.
   • Reporting within 2 business days: Liability is capped at $50.
   • Reporting after 2 business days but within 60 days: Liability increases to $500.
   • Reporting after 60 days: Consumers may face unlimited liability for unauthorized transactions.
2. Disclosure Requirements
   Financial institutions must provide clear and accurate disclosures about EFT services, fees, and consumer rights under the EFTA. This ensures transparency and helps consumers make informed decisions.
3. Error Resolution Process
   If a consumer identifies an error in an EFT, such as incorrect amounts or duplicate transactions, they must report it to the financial institution. The institution is required to investigate and resolve the issue, typically within 45 days.
4. Restrictions on Preauthorized Transfers
   Consumers have the right to stop preauthorized transfers from their accounts by providing written notice to their financial institution at least three business days before the scheduled transfer date.

Civil Claims Under the EFTA

When financial institutions fail to comply with the EFTA, consumers may have grounds for a civil claim. Here are some common scenarios that give rise to litigation under the Act:

1. Failure to Investigate Errors
   Financial institutions are required to investigate and resolve disputes regarding EFTs in a timely manner. If they neglect this duty, consumers may sue for statutory damages, actual damages, and attorney’s fees.
2. Unauthorized Transactions
   Consumers can seek legal recourse if a financial institution improperly holds them liable for unauthorized transactions, especially when the consumer reported the issue within the prescribed timeframes.
3. Improper Disclosure or Notice
   Inadequate or misleading disclosures about EFT services or consumers’ rights under the EFTA can form the basis of a claim. For instance, failure to inform consumers about liability limits or the error resolution process may violate the Act.
4. Neglecting to Stop Preauthorized Transfers
   If a consumer requests the cancellation of a preauthorized transfer but the financial institution allows it to proceed, the consumer may bring a claim.

Damages and Remedies

Under the EFTA, consumers can recover:

• Actual Damages: Compensation for financial losses directly resulting from the violation.
• Statutory Damages: Ranging from $100 to $1,000 for individual claims, depending on the nature of the violation.
• Attorney’s Fees and Costs: Courts may award reasonable attorney’s fees to prevailing plaintiffs, incentivizing legal representation for consumers.
• Punitive Damages: While not explicitly provided for in the EFTA, some courts have awarded punitive damages in cases involving egregious misconduct.

Tips for Attorneys Representing EFTA Claimants

1. Gather Evidence Promptly
   Encourage clients to save documentation of transactions, account statements, and communications with the financial institution. This will support their claims.
2. Understand the Timelines
   EFTA claims often hinge on whether consumers met reporting deadlines. Pay close attention to when the issue was discovered and reported.
3. Leverage Statutory Damages
   Even if actual damages are minimal, statutory damages and the potential for fee recovery can make EFTA claims worthwhile for clients.
4. Consider Class Actions
   When a financial institution has engaged in widespread noncompliance, class action litigation may be appropriate. This can amplify the impact of EFTA enforcement.

The EFTA is a critical tool for protecting consumers in today’s digital economy. For attorneys, it offers a robust framework for holding financial institutions accountable and securing justice for clients. If you or someone you know has been affected by an electronic funds transfer issue, seeking legal advice promptly can make all the difference.

Contact our office to learn more about your rights under the EFTA and how we can help.

The Federal Trade Commission has brought several lawsuits against other entities allegedly perpetrating identical scams this year, including: (1) FTC v. Automators LLC, Case No. 3:23-cv-01444 (S.D. Cal. 2023); (2) FTC v. Empire Holdings Group, LLC, Case No. 24-cv-4949 (E.D. Penn. 2024); (3) FTC v. THEFBAMACHINE Inc., Case No. 24-cv-06635 (D.N.J. 2024); (4) FTC v. Ascend Capventures Inc., Case No. 24-cv-07660 (C.D. Cal. 2024); (5) FTC v. Ecom Genie, Case No. 24-cv-23976 (S.D. Fla. 2024). Below, we briefly summarize the specific facts of each of those cases.

FTC v. Automators LLC (2023)

In August 2023, the Federal Trade Commission (FTC) filed a lawsuit against Automators LLC and associated entities, alleging they operated a deceptive business opportunity scheme. The defendants promised consumers substantial returns by investing in online stores purportedly enhanced by artificial intelligence (AI). They claimed that their AI tools would ensure success and profitability for investors. However, the FTC contended that these promises were unfounded, leading consumers to invest approximately $22 million without realizing the advertised profits.

In February 2024, the owners of Automators LLC agreed to a settlement with the FTC. As part of the agreement, they surrendered millions in assets to provide refunds to affected consumers. Additionally, the businesses and two of their owners were permanently banned from selling business opportunities or coaching programs related to e-commerce stores.

FTC v. Empire Holdings Group (2024)

In September 2024, the Federal Trade Commission (FTC) filed a lawsuit against Empire Holdings Group LLC, operating as Ecommerce Empire Builders and Storefunnels.net, along with its CEO, Peter Prusinowski. The FTC alleged that the defendants engaged in deceptive practices by marketing business opportunities that falsely promised consumers substantial income through “AI-powered” e-commerce stores. Consumers were encouraged to invest in training programs costing nearly $2,000 or to purchase “done-for-you” online storefronts for tens of thousands of dollars, with assurances of potential earnings reaching millions. However, the FTC contended that these profits rarely materialized, leaving consumers with little to no return on their investments.

The FTC’s complaint also highlighted that the defendants failed to provide required disclosure documents, included non-disparagement clauses in their contracts to suppress negative reviews, and challenged consumers who sought refunds. These actions were alleged to violate the FTC Act, the Business Opportunity Rule, and the Consumer Review Fairness Act.

As a result of the FTC’s action, a federal court issued a temporary restraining order halting the scheme and appointed a receiver to take control of the business operations. The case remains pending, with the FTC seeking a permanent injunction and monetary relief to prevent further consumer harm.

FTC v. THEFBAMACHINE Inc. (2024)

In June 2024, the Federal Trade Commission (FTC) initiated legal action against TheFBAMachine Inc., Passive Scaling Inc., and associated entities, alleging that they operated a deceptive business opportunity scheme. The defendants purportedly promised consumers guaranteed income through online storefronts enhanced by artificial intelligence (AI) tools. They claimed that their AI-powered software would ensure substantial passive income for investors. However, the FTC contended that these promises were unfounded, leading consumers to invest significant sums without realizing the advertised profits.

The FTC’s complaint highlighted that the defendants made false or unsubstantiated earnings claims and failed to provide required disclosure documents. Additionally, they included non-disparagement clauses in their contracts to suppress negative reviews and challenged consumers who sought refunds. These actions were alleged to violate the FTC Act, the Business Opportunity Rule, and the Consumer Review Fairness Act.

As a result of the FTC’s action, a federal court issued a temporary restraining order halting the scheme and appointed a receiver to take control of the business operations. The case remains pending, with the FTC seeking a permanent injunction and monetary relief to prevent further consumer harm.

FTC v. Ascend Capventures Inc (2024)

In September 2024, the Federal Trade Commission (FTC) filed a lawsuit against Ascend Capventures Inc., also operating under names such as Ascend Ecom, Ascend Ecommerce, ACV Partners, and ACV Nexus. The FTC alleged that the company, led by William Basta and Kenneth Leung, engaged in deceptive practices by promoting a business opportunity scheme that falsely promised consumers substantial passive income through AI-powered online stores on platforms like Amazon, Walmart, Etsy, and TikTok. Consumers were charged tens of thousands of dollars to start these online stores and were required to invest additional funds in inventory. Despite assurances of significant earnings, most consumers did not realize the promised profits and were left with considerable financial losses.

The FTC’s complaint also highlighted that Ascend Capventures failed to provide required disclosure documents, included non-disparagement clauses in their contracts to suppress negative reviews, and challenged consumers who sought refunds. These actions were alleged to violate the FTC Act, the Business Opportunity Rule, and the Consumer Review Fairness Act.

As a result of the FTC’s action, a federal court issued a temporary restraining order halting the scheme and appointed a receiver to take control of the business operations. The case remains pending, with the FTC seeking a permanent injunction and monetary relief to prevent further consumer harm.

FTC v. Ecom Genie (2024)

In October 2024, the Federal Trade Commission (FTC) filed a lawsuit against Ecom Genie Consulting LLC and associated entities, alleging they operated a deceptive business opportunity scheme. The defendants promised consumers substantial profits by selling goods through online platforms like Amazon and Walmart, charging tens of thousands of dollars to start these e-commerce businesses. However, the FTC contended that the promised earnings rarely materialized, leading most consumers to lose significant amounts of money.

The scheme operated under various names, including Lunar Capital Ventures, Ecom Genie, and Profitable Automation, and was previously known as Valiant Consultants Inc. The FTC’s complaint highlighted that the operators used enticing but bogus claims to lure consumers, failing to provide the required disclosures mandated by the FTC’s Business Opportunity Rule.

As a result of the FTC’s action, a federal court temporarily shut down the operations of the scheme, which had taken more than $12 million from consumers. The court also appointed a receiver to take control of the business operations. The case remains pending, with the FTC seeking a permanent injunction and monetary relief to prevent further consumer harm.

FTC v. AWS, LLC (2018)

In 2018, the Federal Trade Commission (FTC) took legal action against AWS, LLC, FBA Stores, and related entities for promoting a deceptive business opportunity scheme known as the “Amazing Wealth System.” The defendants falsely claimed that consumers could earn substantial income by purchasing their system to sell products on Amazon.com. However, most participants did not achieve the advertised earnings and often faced issues with their Amazon seller accounts, including suspensions.

The FTC’s complaint led to settlements that banned the defendants from marketing and selling business opportunities and business coaching services. Additionally, they were required to surrender funds and assets for consumer redress. In August 2020, the FTC distributed over $9.1 million in refunds to consumers affected by the scheme.

Banks Law Office has brought a class action lawsuit against Wealth Assistants (the case is called “Hough v. Carroll”) for perpetrating a similar scam.

Banks Law Office is currently investigating several entities that may be perpetrating similar Amazon store-management frauds, including:

• Ecom Authority, which is run by Daniel Cohen.
• Alluvium, which is run by Samantha Segrest.

If you have any information about these scams or similar ones, please contact us.

Fraudulent investment schemes have wreaked havoc on countless lives, and one of the most egregious cases to surface recently involves Wealth Assistants. We previously announced that a Court ordered an asset freeze against Wealth Assistants.

Wealth Assistants’ complex network of individuals and entities perpetrated a widespread scam, targeting over 600 victims and swindling over $50 million.

As attorneys representing the victims, we are committed to seeking justice for those who trusted this operation with their hard-earned money.

This blog post delves into the details of this fraudulent scheme, the legal action we’ve taken, and what this case represents for consumer protection and accountability.

The Wealth Assistants Scheme

Wealth Assistants marketed itself as a way for individuals to achieve financial freedom through passive income. The pitch was enticing: clients would invest in a fully managed Amazon store, pay upfront fees and inventory costs, and in return, enjoy substantial monthly profits. The promises included:

• Passive Income: Wealth Assistants claimed they would manage every aspect of the Amazon stores, from customer service to inventory procurement.
• High Returns: They projected monthly profits of $10,000 or more within the first year of operations.
• Risk-Free Investment: A buyback guarantee was offered if the promised returns were not met.

Unfortunately, these promises were lies. Instead of setting up successful stores, Wealth Assistants delivered either non-functional storefronts or nothing at all. Many clients were charged for inventory that was never purchased, and others never saw a penny of the profits they were promised.

A Pattern of Deception

The heart of this scheme was deception, carefully orchestrated by Wealth Assistants’ operators. Here’s how they carried out their fraud:

1. Aggressive Marketing: Using professional presentations, slick sales pitches, and inflated profit projections, they lured middle-class individuals who were often using retirement savings or home equity loans to invest.
2. False Guarantees: Contracts included promises of buybacks if returns weren’t realized, but these guarantees were never honored.
3. Financial Exploitation: Wealth Assistants charged onboarding fees as high as $125,000 and collected further payments for inventory and operational costs, all while knowing they would not fulfill their promises.
4. Blaming External Factors: When clients began to complain, Wealth Assistants cited vague issues like “supply chain disruptions” to delay refunds or performance.

The result? Victims received little to no return on their investments, and many were left financially devastated.

Our Legal Action: Standing Up for Victims

Our firm has filed a Second Amended Complaint as a class action in the United States District Court for the Central District of California. This lawsuit represents not just a handful of individuals but the hundreds of victims impacted by this egregious fraud. Our claims include:

1. Fraud Conspiracy: A detailed plan executed by Wealth Assistants and its affiliates to defraud clients.
2. Aiding and Abetting Fraud: Other parties, including financial institutions, knowingly or negligently enabled this fraud.
3. Fraudulent Transfers: Defendants moved funds to hide them from creditors and victims.
4. Aiding and Abetting Breach of Fiduciary Duty: Certain professionals who should have acted in their clients’ interests instead facilitated the fraud.

The Role of Financial Institutions

Several well-known financial institutions allegedly played a role in enabling this scheme. These institutions allegedly failed to detect clear red flags and, in some cases, directly facilitated the fraudulent activities by providing banking services to Wealth Assistants and its affiliates.

Banks have strict obligations under anti-money laundering regulations, including monitoring transactions and identifying suspicious activities. In this case, some banks allegedly assisted Wealth Assistants in transferring and concealing funds, making it harder for victims to recover their money. Our lawsuit highlights the need for accountability not just from the fraudsters but also from those who enabled them.

Impact on Victims

The human toll of this scheme is staggering. Many of Wealth Assistants’ clients were middle-class individuals seeking to improve their financial situations. Instead, they found themselves burdened with significant losses:

• Families drained their savings and retirement accounts.
• Some investors took on home equity loans, risking their homes in the process.
• Many victims now face long-term financial struggles and emotional distress.

This case serves as a stark reminder of the devastating consequences of unchecked fraud.

A Web of Fraudulent Entities

Wealth Assistants did not act alone. The complaint identifies a network of affiliated entities and individuals who worked together to perpetrate this scheme. Among them are:

• The Operators: Key individuals behind Wealth Assistants orchestrated the scam and reaped its profits, using client funds to finance lavish lifestyles.
• Alter Ego Entities: Shell companies were created to hide and transfer funds, making it harder for creditors to track the money.
• Partners in Fraud: Other e-commerce firms collaborated with Wealth Assistants, helping it expand its operations and conceal its activities.

This network’s deliberate attempts to evade accountability further demonstrate the need for robust legal action.

Why This Case Matters

Our fight against Wealth Assistants is about more than recovering stolen funds. It’s about standing up to fraudulent practices that undermine trust and ruin lives. This case is a critical step in:

• Seeking Justice for Victims: Ensuring that those who were wronged are compensated for their losses.
• Holding Institutions Accountable: Sending a clear message to financial institutions that turning a blind eye to fraud is unacceptable.
• Preventing Future Fraud: Exposing the tactics used in this scheme can help others recognize and avoid similar scams.

Fraudsters often rely on the belief that their victims will not fight back. This lawsuit aims to prove them wrong.

How You Can Protect Yourself

This case is a reminder of the importance of due diligence when evaluating investment opportunities. Here are some tips to protect yourself:

1. Verify Claims: Always request evidence of past performance and confirm the legitimacy of guarantees.
2. Research the Company: Check for reviews, legal actions, or complaints against the business.
3. Be Skeptical of Unrealistic Promises: If an opportunity sounds too good to be true, it likely is.

If you believe you’ve been a victim of fraud, seek legal advice immediately.

Conclusion

Fraudulent schemes like Wealth Assistants prey on people’s hopes and dreams, often leaving them in financial ruin. Through this class action lawsuit, we aim to hold all responsible parties accountable and recover funds for those who were wronged.

At [Your Law Firm Name], we are committed to fighting for justice and protecting consumers from fraud. If you or someone you know has been affected by this scheme or a similar one, please reach out to us. Together, we can send a powerful message that fraud will not go unchecked.

I want to comment about “Fulfillment by Amazon” business opportunity scams. To carry out these scams, fraudsters advertise that they can set up and operate highly profitable Amazon ecommerce stores for “investors.” The “investors” send the fraudsters between $10,000 and $200,000 to set up and operate these stores, and the fraudsters pocket most of that money; they do not provide meaningful services for the investors, and sometimes they do not provide the investors with an Amazon store at all. These scams have collectively stolen hundreds of millions of dollars from their victims in the last five years. The FTC has brought several actions to shut down these scams, most recently last month in FTC v. Ecom Genie. But the scam continues to proliferate publicly: entities called Ecom Authority; Proficient Supply LLC; Quantum Ecommerce; Wholesale Universe; and Alluvium are just a few examples of entities that are operating this ongoing scheme. My comment is that the civil actions the FTC has taken against the FBA scams are appreciated, but they’ve proven to be insufficient. After the FTC obtains an injunction, the fraudsters go hide for a few months and then start back up again, re-branded. And I want to make two suggestions. First and foremost, these are large theft schemes that will not be deterred unless there are criminal consequences, so the FTC should be referring these cases to the FBI. Second, the FTC should be clear with Amazon that it has a duty to at least try to avoid providing a platform for these frauds, and to report the frauds to law enforcement when it discovers them. As it stands, Amazon is complicit. Right now, for example, it is continuing to let Proficient Supply operate on its platform despite the permanent restraining order the FTC obtained against that company.

As a disclosure, I should mention that I am the plaintiff’s attorney in a case called Hough v. Carroll, which is a putative class action brought against one of these scams called “Wealth Assistants.”

Thank you for your time.

A judge has ordered the owners of get-rich-on-Amazon startup Wealth Assistants to have their assests frozen

Earlier Business Insider articles describe the nightmare investors in Wealth Assistants are enduring:

More than 60 former Wealth Assistants clients sued the get-rich-on-Amazon startup, claiming they were defrauded out of millions

Banks Law Office attorney, Nico Banks, represents a group of investors in a lawsuit against Wealth Assistants and its owners. He seeks justice and restitution for those who have been wronged by the alleged fraudulent activities of the company. The allegations brought forth paint a troubling picture of intentional misrepresentations, asset dissipation, and attempts to conceal financial resources by the defendants.

The case revolves around a core accusation that Wealth Assistants, led by Ryan Carroll, Max K. Day, Michael Day, and others, misled clients and conspired to defraud them out of significant sums of money. Clients paid substantial fees with the expectation that their Amazon storefronts would be professionally managed and yield profitable results. However, many of them found their stores either lacking inventory or failing to generate sufficient sales to cover the upfront costs.

The lawsuit against Wealth Assistants is about seeking transparency and justice. The plaintiffs have been wronged, and it is our duty to pursue all legal avenues to uncover the truth, locate hidden assets, and secure a favorable outcome for those who have suffered as a result of these alleged deceptive practices.