For the second time in three years, Dallas resident Jeffrey Gordon was at the center of an investment fraud lawsuit by the Securities and Exchange Commission.
Gordon and the two companies he controls, Blue Rock Ventures and Windy City Accelerated Returns Venture I LLC, defrauded at least 18 investors out of nearly $ 1 million in a real estate investment scheme, according to data The lawsuit was filed on Thursday by the SEC.
The complaint alleges that from around July 2016 to January 2018, Gordon sold his stakes in Windy City to investors, which he claimed would use the investors’ funds to buy real estate rental companies near Chicago. He also said Blue Rock owns stakes that investors will buy in these Chicago-based companies. Both companies are registered in Delaware with their main offices in Dallas.
Among the several false and misleading claims cited in the lawsuit were allegations that the rental property was “100% rented out” and that an investment was made to renovate the property so that it could be rented out at higher rates. and then sell, will yield an income of 250% to 350%. in three to five years. Gordon also allegedly told investors that he would increase the value of the investment by refinancing real estate loans at lower interest rates.
“According to the complaint, Gordon’s statements were essentially false and misleading,” the SEC said in a press release. The complaint alleges that he misappropriated most of the investor funds for unrelated and personal purposes such as luxury hotels, gambling, vacation rentals and payments to private schools.
The Securities and Exchange Commission states that Blue Rock did not own any share in the leased property, and Gordon never bought shares in the leased property on Windy City’s behalf. According to the complaint, he also did not renovate the property or refinance their mortgages.
The lawsuit requires Gordon to be barred from acting as an officer or director of a public company, in addition to a number of other penalties. Officials from the SEC’s regional office in Fort Worth conducted an investigation.
Gordon did not respond to requests for comment on this matter.
Gordon is familiar with the SEC. The stock market regulator sued him and his company Texas Coastal Energy of Dallas in 2018. for defrauding 80 oil and gas investors out of more than $ 8 million by distorting the company’s financial data, overestimating the expected production from its wells and exaggerating the experience of a geologist. He and the company were ordered to pay about $ 7 million for the scheme.
The charter of Texas Coastal Energy, which Gordon co-founded in 2011, was revoked in 2014 and then in 2016 by the Office of the Texas Secretary of State for tax evasion.
The energy company, along with Gordon and fellow co-founder Vance McAllister, was sued in 2017 for allegedly failing to pay a $ 130,000 lease for Tesla’s Model S.
Gordon also ran into legal trouble with his other company, Black Shark Family Investments LLC, when the two were sued in 2017 for allegedly failing to pay their rent of an office in Santander Tower.