We are offering Video Chat services through all Apple, Android, and Skype devices. This includes initial consultations.

Team Photo
Justia Lawyer Rating

Investment Advisor Fraud in Connection with Woodbridge Securities Promissory Notes

The securities attorneys of Lubiner Schmidt & Palumbo would be interested in speaking with any investors who sustained investment losses in connection with Woodbridge Wealth Management; 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 PA, LLC; Woodbridge Group of Companies, LLC (d/b/a Woodbridge Wealth); and Woodbridge Promissory Notes (“Woodbridge”) and registered investment advisor Gary Scheer. Our firm is presently investigating claims in connection with Woodbridge and Gary Scheer.

Woodbridge has been the subject of regulatory investigations from a number of state securities regulators including, but not limited to, New Jersey, Massachusetts, Texas, and Arizona. Many of the Woodbridge Promissory Note investments were sold to senior citizens who thought they were buying safe, secured, short-term investments and instead, now face total losses. The investment advisors who sold these products received very generous commissions from Woodbridge.

The allegations concern supposedly “secured notes” issued by Woodbridge. Woodbridge was formed in 2014 as a company that was purchasing commercial and residential properties that would be offered in a portfolio to investors. Woodbridge marketed itself as a safe investment, offering above market rate yield on short term promissory notes. Investors would be afforded safety in the form of a first lien on the portfolio of properties comprised in the promissory note. If any of the mortgages defaulted, the underlying property would secure the note. Woodbridge pledged short term yields in the range of 7-10%, well above the benchmark rate for even high yield junk bonds.

This made the investment very attractive for investors looking for safety and income; the two investment objectives most aligned with senior retired investors. Woodbridge marketed their product not as a security, but as a loan in the form of the promissory note, meaning individuals without a Series 7 securities license would be able to market and sell the Woodbridge promissory notes. Woodbridge offered registered investment advisors large commissions in order to gain traction for the Woodbridge promissory notes.

Immediately after marketing promissory notes, Woodbridge came under regulatory scrutiny. On May 4th, Massachusetts state securities regulators issued a cease and desist order against them. Woodbridge became subject to investigations by a number of states challenging their contention that the products being marketed were not securities. State and federal regulators also began investigating Woodbridge for aggressive sales tactics of the Woodbridge Promissory Notes being marketed, as well as securities fraud. In addition to Massachusetts, investigations were opened by a number of states securities regulators, as well as the SEC. Despite the negative press surrounding Woodbridge during these investigations, Woodbridge continued to sell millions worth of promissory notes, primarily to senior investors. According to the Wall Street Journal, millions of Woodbridge promissory notes were sold all while the SEC was conducting its investigation.

In December 2017, Woodbridge filed for bankruptcy. The SEC charged Woodbridge with running a Ponzi scheme in the same month. In the SEC lawsuit, Woodbridge CEO Robert Shapiro was accused of using the investments of new customers of Woodbridge to pay the interest on existing customer notes, as well as pilfering millions from the company to fund his lavish lifestyle.

Investment advisors who sold this product after the multiple regulatory investigations were launched, starting in May 2015, should have been aware of the issues confronting Woodbridge and disclosed those risks to those prospective investors.

According to Investment Adviser Public Disclosure, Gary Scheer was licensed as a Series 65 investment advisor in 2008. He has his own investment group, known as Gary Scheer LLC. Previously, Gary Scheer was employed by Retirement Wealth Advisors Inc. As of January 2018, he has established Retirement Financial Advisors.

If you or someone you know has purchased Woodbridge promissory notes from Gary Scheer, the attorneys at Lubiner Schmidt & Palumbo would be interested in speaking with you. Please contact our office for a consultation and put our experienced securities fraud team to work.

Client Reviews
I came to them with a lawsuit I wanted to pursue against a big company. I called other lawyers who didn't understand or want to listen to me. They researched the case and took it on contingency. 3 months later when no other lawyer would listen they got me mid 6 figures. They always returned my email or call me to update. Great negotiator as I would have taken the first offer and they got me double. They are smart, down to earth guys that don't talk down to you unlike other lawyers. If this firm can't help you than nobody can. Michael
They respond in a timely manner to any of my questions. Their quality of service is excellent. If you are seeking legal muscle behind you and a competent lawyer to handle your case, Mr. Lubiner is the answer. George A.
Our firm has engaged Lubiner & Schmidt LLC for over fifteen years. They have always surpassed our expectation and the quality of service has been excellent. We strongly recommend their services to any corporate client seeking legal help. Girish N.