Investors Sue Coldwell Banker for $50 Million for Alleged Fund Scheme
U.S. District Court Judge Andrew J. Guilford in Santa Ana has ruled that a $50 million lawsuit against Coldwell Banker on behalf of 1,300 investors in seven real estate investment funds can move forward.
Five plaintiffs are named in the suit that alleges an investment scheme was perpetrated by Real Estate Partners Inc. and a Coldwell Banker commercial franchisee doing business as Coldwell Banker Commercial Real Estate Partners.
The suit alleges the now-bankrupt Real Estate Partners and Coldwell Banker Real Estate Partners used the Coldwell Banker name and marks to market and sell unregistered securities in investment funds known as Income Fund I, Income Fund II, Income Fund III, Unit Investment Business Trust I, Unit Investment Business Trust II, Equity Fund and Growth Fund.
Investors across the country lost about $50 million in these funds. More than 130 investors have signed affidavits claiming they put their money into the funds because of the Coldwell Banker connection, reads a statement from the investors' Los Angeles-based lawyers.
The Securities and Exchange Commission previously sued and obtained a judgment against Real Estate Partners. The investor suit targets Coldwell Banker Real Estate Corp. and Coldwell Banker Real Estate LLC. Trial is set for August. Read the 28-page certification order HERE.
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