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Court Orders Woodbridge To Produce Documents To SEC

woodbridge-300x82The U.S. Securities and Exchange Commission (“SEC”) obtained an order on September 21, 2017 requiring the Woodbridge Group of Companies LLC (“Woodbridge”), of Sherman Oaks, California, to produce the documents of several company executives and employees, including the President and CEO.  This order reportedly relates to an SEC investigation of Woodbridge.

The SEC is reportedly investigating whether Woodbridge and others have violated or are violating the antifraud, broker-dealer, and securities registration provisions of the federal securities laws in connection with Woodbridge’s receipt of more than $1 billion of investor funds.  According to the SEC’s application and supporting papers filed in federal court in Miami on July 17, 2017, investors from around the country may have been affected.

On January 31, 2017, in furtherance of the SEC’s probe into Woodbridge, SEC staff in the Miami Regional Office reportedly served Woodbridge with a subpoena seeking the production of electronic communications that the company maintained relating to Woodbridge’s business operations, as well as other documents.  Court papers filed by the SEC allege that the company has failed to produce any relevant communications in response to the subpoena, including those of three high-level Woodbridge officials, despite being legally required to make the production.  The Court overruled Woodbridge’s objections and ordered the documents produced.

Woodbridge’s entities or mortgage funds (which are not necessarily subject to the Court order referenced above) include the following:

  • WMF Management, LLC;
  • Woodbridge Group of Companies, LLC;
  • Woodbridge Mortgage Investment Fund 1, LLC;
  • Woodbridge Mortgage Investment Fund 2, LLC;
  • Woodbridge Mortgage Investment Fund 3, LLC;
  • Woodbridge Mortgage Investment Fund 4, LLC;
  • Woodbridge Mortgage Investment Fund PA, LLC;
  • Woodbridge Group of Companies, LLC (d/b/a Woodbridge Wealth)

Among the many risks associated with investing in securities through a private placement is the potential for fraud or related misconduct.  As described above, in order for unregistered securities to be sold in compliance with federal and applicable state securities laws, in nearly all instances an exemption to registration must apply.  With respect to Woodbridge, it does not appear that the various fund offerings were recommended to investors as exempt securities through a permissible private placement offering.

If you have purchased any of the Woodbridge Notes and have suffered losses, you may be able to recover these losses in FINRA arbitration.  To find out more about your legal rights and options, contact a securities arbitration attorney at Law Office of Christopher J. Gray, P.C. at (866) 966-9598 or for a no-cost, confidential consultation.

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