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 violations of the state’s Deceptive and Unfair Trade Practices Act. The probe centers on claims that the company and its owners may be misappropriating investor funds instead of acquiring properties as advertised, with suspicions of a Ponzi scheme.
Key Takeaways
- Florida Attorney General James Uthmeier’s Office is investigating RAD Diversified REIT Inc. and its owners, Brandon “Dutch” Mendenhall and Amy Vaughn.
- The investigation stems from multiple investor complaints alleging inability to retrieve returns or principal investments.
- Authorities are examining whether the company’s real estate holdings match the value of invested funds.
- Subpoenas have been issued, demanding documentation from the firm and its owners by July 18.
Investigation Details
Attorney General Uthmeier’s office has issued subpoenas to RAD Diversified REIT Inc., its subsidiaries, and owners Brandon “Dutch” Mendenhall and Amy Vaughn. Mendenhall and Vaughn are known for their online presence as social media influencers, promoting seminars that encourage investments in Florida real estate through their company. The investigation aims to determine if the company has violated state laws by engaging in deceptive and unfair trade practices.
Investor Complaints and Allegations
The Attorney General’s office has received numerous complaints from individuals who invested in RAD Diversified. These investors report being unable to collect promised returns or recover their initial capital. Uthmeier stated in a news release, "Our office has received complaints that a popular internet duo selling real estate investment services through their fund is pocketing cash instead of buying properties as advertised." He further added, "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."
Scope of the Investigation
The investigation seeks to gather comprehensive information regarding the complaints. Specifically, authorities are looking into whether the company possesses real estate assets equivalent in value to the total amount invested by its customers. The subpoenas request various documents, including communications between the company and its clients, marketing materials, financial records, and any complaints filed against the company. Special Counsel Ellen Lyons and Senior Assistant Attorney General Miles Vaughn are overseeing the case. Mendenhall and Vaughn have until July 18 to comply with the subpoenas.
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.