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 company may be pocketing investor funds instead of acquiring properties as advertised, with concerns of a possible Ponzi scheme.
Key Takeaways
- RAD Diversified REIT Inc. and its owners, Brandon “Dutch” Mendenhall and Amy Vaughn, are facing investigation.
- Subpoenas have been issued, demanding documents by July 18.
- Investors have reported being unable to retrieve returns or their initial investments.
- The investigation aims to determine if the company’s real estate holdings match the value of customer investments.
Investigation Details
The investigation was launched following multiple complaints from investors who claim they are unable to access their returns or recover their invested capital. Attorney General Uthmeier stated that his office received complaints suggesting that a popular internet duo, promoting real estate investment services through their fund, might be misappropriating funds instead of purchasing properties as promised. "This appears to be a Ponzi scheme, and with several individuals claiming they’ve been exploited, we are investigating to ensure Floridians are not being deceived by greedy fraudsters," Uthmeier said in a news release.
Subpoenas Issued
Subpoenas have been issued to RAD Diversified REIT Inc., its subsidiaries, and owners Brandon “Dutch” Mendenhall and Amy Vaughn. Mendenhall and Vaughn are known for their social media presence and seminars that encourage investments in Florida real estate through the company. They are required to provide requested documents to the Attorney General’s Office by July 18. Special Counsel Ellen Lyons and Senior Assistant Attorney General Miles Vaughn are overseeing the case.
Focus of the Investigation
The core of the investigation is to ascertain whether the company possesses real estate assets equivalent in value to the total amount invested by RAD Diversified REIT customers. The Attorney General’s Office is seeking various forms of evidence, including communications between the company and its clients, documents shared with investors, internal company complaints, operational procedures, marketing materials, and banking records. The company’s investment plan reportedly targets Floridians who may lack the capital to purchase real estate independently.
Sources
- Tampa real estate investment firm under investigation for potential deceptive practices, Florida Politics.