NH Company Accused of Participation in Ponzi Real Estate Scheme

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Rockwell Tic Owler 20160228 150847 Original

The property was effectively owned by Rockwell TIC, a Utah company, and its tenant, event venue operator Noah Corporation.

The Massachusetts investor accuses the New Hampshire firm of luring it into a multimillion-dollar Ponzi scheme to get its stake.

Burlington-based home development corporation HDC last week filed a lawsuit in US District Court in Concord against Edmund & Wheeler, Inc., a Franconian company specializing in 1031 exchanges named after a section of the Internal Revenue Code that allows investors to save capital. profit from real estate, if this profit is invested in similar property.

According to the lawsuit, HDC already used EWI and therefore trusted the company when it offered to invest $ 5 million in a “venture with a long history of stable profitability.” The properties were owned by Rockwell TIC, a Utah company, and its tenant, venue operator Noah Corporation, which promised a 7% return on rent with a 2% annual increase for just $ 2,000.

The property was located near Birmingham, El. And Overland Park, Kansas. But the lawsuit alleges that the property’s value was artificially inflated – the project in Birmingham hadn’t even started yet – and that the rent was paid not for a successful business deal, but at the expense of other investors. After some of that initial annuity, both filed for bankruptcy: Chapter 11 Rockwell and Chapter 7 Noah.

The Securities and Exchange Commission filed similar charges against those behind Rockwell and Noah in a civil fraud lawsuit filed in Utah late last year.

“The Noah Event Centers have collectively been a loss-making venture that was only supported by the infusion of new investor funds,” the SEC said. “Through their misconduct, the Defendants convinced some 90 investors to purchase more than $ 35.9 million in securities in the form of Noah TIC shares between approximately January 2017 and February 20.” The SEC named the defendants William J. Bowser, founder and president of Noah, and Christopher J. Ashby, Scott W. Beynon, and Jordan S. Nelson as owners of Rockwell.

However, HDC’s lawsuit was against EWI and Edward and Wheeler Exchange Services and four individuals who work with these companies: John D. Hamrick, Mary O’Toole, Timothy Burger and Chris Brown. HDC claims that EWI was not a disinterested broker, but withdrew 3% to 6% of the transaction amount, which they did not inform HDC of. The suit also alleged that the EWI defendants were “close business partners” of Bowser and Ashby.

“None of these allegations are true,” Hamrick told the NH Business Review. “They bought a property, and the owner and tenant went bankrupt, and now they’re trying to blame everyone else.”

He added: “They still own the property. They just don’t get rent. “

In its complaint, however, HDC said they dumped their $ 1.6 million stake in two properties, resulting in significant property losses, not to mention unpaid rents.



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