On January 10th, 2019, the Financial Industry Regulatory Authority (FINRA) filed a complaint against Shopoff Securities, Inc. (CRD No. 142866) and two related financial brokers: the firm’s President William A. Shopoff (CRD No. 1273471) and his brother, the firm’s Vice President Stephen R. Shopoff (CRD No. 5276325).
FINRA alleges that these two individuals used the brokerage firm to sell more than $12 million in fraudulent promissory notes to investors.
Here, our investment fraud lawyers offer an overview of this complaint. For full details regarding the allegations against Shopoff Securities, please refer to Disciplinary Proceeding No. 2016048393501.
Allegations: Two Dozen Investors Were Defrauded Through Real Estate Promissory Notes
Beginning in 2006, William Shopoff began offering private placement promissory notes to investors. In 2010, Mr. Shopoff began recommending these private placement investments to customers of the brokerage firm Shopoff Securities.
FINRA contends that at least 29 different investors put in a total of $12.5 million into these investments.
In its complaint, FINRA alleges that William Shopoff and Stephen Shopoff made material misrepresentations and material omissions to investors. The promissory notes were worth far less than investors imagined.
As an example, investors were informed that the investment entity was expected to make $6.5 million in profits off of the sale of residential lots in Southern California. In reality, the entity made less than $22,000 from these sales.
FINRA is seeking findings of fact and conclusions of law against Shopoff Securities, William Shopoff, and Stephen Shopoff. In addition, the agency is requesting the imposition of all other sanctions that are appropriate in the circumstances, potentially including the disgorgement of any ill-gotten gains and payment of complete restitution to affected investors.
Speak to a Top-Rated Promissory Note Fraud Lawyer Today
At Sonn Law Group, our investment fraud attorneys have deep experience representing clients in promissory note fraud cases. For a free, no obligation review of your claim, please do not hesitate to contact us today.
Disclaimer: This article contains opinions and NOT statements of fact in any way whatsoever. The information here is general information that should not be taken as legal advice. NO attorney-client relationship is established between you and our attorneys by reading this article. This article is attorney advertising and should not be used as a substitute for legal advice from a qualified securities lawyer.