Investors in certain syndicated conservation easement private placements may have legal claims, if their investment was recommended by a financial advisor who lacked a reasonable basis for the recommendation, or if the nature of the investment was misrepresented by the stockbroker or advisor.
The federal government is suing EcoVest Capital (“EcoVest”), a real estate investment company, for allegedly creating sham tax shelters by exploiting so-called conservation easements, which are intended to preserve natural land. EcoVest’s scheme hinged on grossly overvalued appraisals, the lawsuit alleges. EcoVest, based in Atlanta, is reportedly one of the biggest promotors of syndicated conservation easements investment programs. The Justice Department suit states that EcoVest has been involved in 51 syndication easement deals since 2009, generating $1.7 billion in federal tax deductions.
Investors who bought investments in private placements known as syndicated conservation easements could be facing serious consequences: their investments could be worthless and they may be facing back taxes, interest, tax penalties, and audits.