A Tampa-based real estate investment firm, RAD Diversified REIT Inc., and its owners are currently under investigation by Florida Attorney General James Uthmeier’s Office for potential violations of the state’s Deceptive and Unfair Trade Practices Act. The probe centers on allegations that the firm may be mismanaging investor funds, with some investors reporting an inability to retrieve their returns or initial capital.
Key Takeaways
- RAD Diversified REIT Inc. and its owners, Brandon “Dutch” Mendenhall and Amy Vaughn, have been subpoenaed.
- The investigation is looking into whether the company is pocketing funds instead of investing them in real estate as advertised.
- The Attorney General’s office has received multiple complaints from investors unable to access their money.
Investigation Details
The investigation was launched following numerous complaints from individuals who invested in RAD Diversified. Attorney General Uthmeier stated that the office received information suggesting the firm might be operating a Ponzi scheme, where cash from new investors is used to pay earlier investors, rather than being used for actual property acquisitions.
Mendenhall and Vaughn, who have cultivated a significant online presence as social media influencers promoting real estate investment seminars, are central to the inquiry. Their investment strategy, promoted through videos and social media, aims to pool funds from Floridians who may not have sufficient capital to purchase property independently.
Subpoena and Information Sought
Subpoenas have been issued to RAD Diversified REIT Inc., its subsidiaries, and its owners, demanding documents by July 18. The Attorney General’s Office is seeking to verify if the company’s real estate holdings are equivalent in value to the total amount invested by its customers. The requested information includes:
- Communications between the company and its customers.
- Documents provided to investors.
- Internal company complaints and procedures.
- Marketing materials.
- Banking records.
Special Counsel Ellen Lyons and Senior Assistant Attorney General Miles Vaughn are overseeing the case, aiming to determine if Floridians have been victims of fraudulent practices.
Sources
- Tampa real estate investment firm under investigation for potential deceptive practices, Florida Politics.