A Tampa-based real estate investment firm, RAD Diversified REIT Inc., is currently under investigation by Florida Attorney General James Uthmeier’s Office for alleged deceptive practices and potential violations of state laws. The probe, which includes subpoenas issued to the company and its owners, Brandon “Dutch” Mendenhall and Amy Vaughn, centers on accusations that investor funds may have been misappropriated instead of being used for property acquisitions as advertised.
Key Takeaways
- Florida Attorney General’s Office is investigating RAD Diversified REIT Inc. for deceptive practices.
- Allegations include potential Ponzi scheme activity and failure to use investor funds for property purchases.
- Owners Brandon “Dutch” Mendenhall and Amy Vaughn have been subpoenaed.
- Multiple investor complaints cite difficulties in retrieving returns or principal investments.
Investigation Details
The investigation was prompted by numerous complaints from investors who claim they are unable to collect promised returns or recover their initial investments from RAD Diversified. Attorney General Uthmeier stated that the office has received complaints suggesting that the company might be "pocketing cash instead of buying properties as advertised." He further indicated that the situation "appears to be a Ponzi scheme," and the office is working to determine if the company’s real estate holdings are equivalent in value to the total amount invested by its customers.
Subpoenas Issued
Subpoenas have been issued to RAD Diversified REIT Inc., its subsidiaries, and owners Brandon “Dutch” Mendenhall and Amy Vaughn. Mendenhall and Vaughn, who have gained a following as internet and social media influencers, promote seminars encouraging investments in Florida real estate through their company. The subpoenas demand that the company and its owners provide relevant documents by July 18, including communications with customers, marketing materials, financial records, and details of company procedures. Special Counsel Ellen Lyons and Senior Assistant Attorney General Miles Vaughn are overseeing the case.
Investor Concerns
Investors involved with RAD Diversified have reported significant issues with accessing their funds. The company’s investment model is designed to pool funds from individuals who may not have sufficient capital to purchase real estate independently. The Attorney General’s Office is actively seeking evidence to corroborate these complaints and ascertain the extent of any alleged wrongdoing.
Sources
- Tampa real estate investment firm under investigation for potential deceptive practices, Florida Politics.
- Florida AG probes Tampa real estate firm RAD over Ponzi scheme claims, The Business Journals.