The Expert Podcast

You may remember back about a year or so ago we did an exposé on a potential fraud from a company called NRIA — National Real Estate Investment Advisors. This was a case where we had some clients or victims that came forward and were curious about how this company was advertising and potentially a fraud. We did some investigation and we found some troubling facts about the company. One was, one of the principals was using a fake name and they had a prior record. Well, it looks like now finally this has been proven as a fraud.

So let's take a look. As of last week, according to the U.S. Securities and Exchange Commission (SEC), the real estate development company called National Real Estate Investment Advisors has been formally charged with a $600 million Ponzi scheme. Again, this is at this point allegedly — it's not been proven in court. Innocent until proven guilty and all that — but it was charged. The company and its former executives are accused of running a Ponzi scheme that raised $600 million from investors.

This is a company you heard advertising on CNBC and Fox News and a lot of other channels, beginning back in 2018. It wasn't long after that that we started doing some research on this company — that was in 2019–2020. The company promised that the investment money would be used to buy and develop real estate. They were collecting tens and hundreds of millions of dollars and supposedly this real estate would develop and generate profits.

Well, turns out that most of the investor money was used to pay distributions to other investors — à la Ponzi scheme — and to fund the executives' personal and luxury purchases. They also used some of the money to pay reputation management firms to thwart investors' due diligence. And we ran into this when we started investigating. We found that there were companies trying to run interference to keep us from finding out about the executives. One of the executives was actually using a fake name because he had a prior conviction for a previous Ponzi scheme that was very similar to this NRIA scheme. And when we did the investigation, we found this as well.

The real estate fund's financial statements were manipulated in the marketing material to make it look like there were actually more profits than were actually happening. So this is what we'd like to see — where an investigation that we started comes to fruition and there's at least now a thorough government investigation. Look, it may not turn out to be a full-blown Ponzi as deep as what is being alleged here. However, at least now the government's involved in trying to find out — to get to the bottom of it — and maybe victims now will start getting their money back through recovery of assets and recovery of funds lost to this scheme, allegedly.