Erez Law is currently investigating former NYLife Securities LLC broker Alan New (CRD# 2892508) regarding the Woodbridge Group of Companies Ponzi scheme. New was registered with NYLife Securities LLC in Fort Wayne, IN from 2004 to August 2016.
In April 2020, FINRA barred New after he, “consented to the sanction and to the entry of findings that he failed to provide documents and information requested by FINRA during the course of an ongoing investigation of his participation in the sale of promissory notes.”
In December 2018, the SEC opened an investigation, alleging that from at least September 2013 through August 2017, “the Defendants in this action served as unregistered brokers on behalf of Woodbridge Group of Companies LLC and its affiliates (“Woodbridge”), raising approximately $15 million from the offer and sale of Woodbridge’s unregistered securities to at least 100 retail investors located in at least nine states. The Defendants, all based in Fort Wayne, Indiana, collectively earned more than $1.5 million in transaction-based sales commissions. The Defendants pitched investors, both pre-existing customers and newly found, via telephone, e-mail and at in-person meetings providing them Woodbridge’s sales materials touting Woodbridge’s securities as “safe and secure.” Unbeknownst to the Defendants’ customers, many of whom had invested their retirement savings in response to the Defendants’ sales pitches, Woodbridge was actually operating a massive Ponzi scheme, raising more than $1.2 billion before collapsing in December 2017 and filing for bankruptcy. Once Woodbridge filed for bankruptcy, investors stopped receiving their monthly interest payments, and have not received a return of their investment principal. At all relevant times, the Defendants sold Woodbridge’s securities without being registered with the Commission to do so, nor were they associated with a registered broker-dealer who was selling Woodbridge’s securities. Further, Woodbridge’s securities were not registered with the Commission nor did they qualify for an exemption from registration. Defendants were thus not permitted to sell Woodbridge’s securities.”
The Woodbridge Group of Companies is a southern California luxury real estate developer that missed payments on notes sold to investors and filed chapter 11 bankruptcy in December 2017, along with 275 subsidiaries and affiliates, citing “unforeseen costs associated with ongoing litigation and regulatory compliance.” It is alleged that elderly and other investors invested millions of dollars into the Woodbridge Group of Companies investment programs. The investors were allegedly told that these were secure investments in real estate, which is not the case as evidenced by these bankruptcy proceedings.
The SEC is investigating whether 235 LLCs have violated the anti fraud, broker-dealer and securities registration provisions of the federal securities laws in connection with the Woodbridge Group of Companies receipt of more than $1 billion of investor funds from thousands of investors nationwide. The SEC is investigating the offer and sale of unregistered securities, the sale of securities by unregistered brokers and the commission of fraud in connection with the offer, purchase and sale of securities.
New has been the subject of 14 customer complaints between 2018 and 2020, according to his CRD report:
- December 2019. “Claimant alleges that he was either intentionally misled about the risks of the portfolio consisting of Woodbridge Promissory Notes or the RR was inexcusably reckless in failing to understand those risks. Claimant has not alleged the time period in which the investment was purchased away from the Firm. Claimant alleges at least $110,000.00 in actual damages.” The customer sought $110,000 in damages and the case was settled for $39,000.
- October 2019. “Customer alleges that he was misled regarding an unregistered investment in Woodbridge Mortgage Investment Fund purchased away from the Firm, in or about October 2015, from which he lost $200,000.00. Customer is to seeking to rescind his New York Life Variable Annuity without penalty.” The customer sought $200,000 in damages and the case was settled for $6,851.81.
- February 2018. “Plaintiff alleges that material facts and the risks associated with an unregistered investment in Woodbridge Mortgage Investment Fund purchased in April 2017 were not disclosed. Plaintiff is seeking the return of his investment ($65,000) less any income received, plus 8% interest, costs and attorney’s fees.” The case was settled for $37,500.
- December 2018. “Claimants allege that in November 2014, January 2015, August 2016 , September 2015, December 2016 and March 2017 they were advised to purchase and subsequently roll over unregistered, nonexempt securities in the form of Woodbridge Promissory Notes. Claimants allege that the Promissory Notes along with an investment in 1 Global Capital LLC in September 2017 were misrepresented as safe and that their Woodbridge investments gave them ownership in certain parcels of property throughout the United States. Claimants seek judgment for all incidental losses, damages for breach of fiduciary duty, disgorgement of commissions, fees and other compensation, rescission of all existing investments and punitive damages.” The case was settled for $100,000.
- October 2018. “Claimants allege that in April 2015, February 2016 and September 2016 they were sold unregistered, nonexempt securities in the form of Woodbridge Promissory Notes. Claimants allege that the Promissory Notes along with an investment in FIP, LLC in February 2015 were unsuitable and inappropriate and that the risks were not disclosed. Claimants further allege that the products were sold away from the broker-dealer and seek $168,308.58 plus interest, cost and fees.” The customer sought $168,308.58 in damages and the case was settled for $75,000.
- September 2018. “Claimants allege that they were sold unregistered and fraudulent investments in Woodbridge Mortgage Investment Funds in January, March and July 2015.Claimants further allege that the investments were falsely represented as safe, secure and low risk and seek recovery of damages in the amount of $125,000 plus costs, interest, fees and punitive damages.” The customer sought $260,000 in damages and the case was settled for $92,937.38.
- August 2018. “Claimants, who are not customers of the Firm, allege that the were sold unregistered and fraudulent investments in Woodbridge Mortgage Investment Funds in February and October 2015 and February 2016. Claimants further allege that the investments were falsely represented as safe, secure and low risk and seek recovery of damages in the amount of $325,000 plus costs, interest, fees and punitive damages.” The customer sought $325,000 in damages and the case was settled for $115,740.68.
- July 2018. “Claimant alleges that material facts and the risks associated with an unregistered investment in Woodbridge Mortgage Investment Fund purchased in April 2014 and October 2015 were not disclosed. Claimant is seeking recovery of damages in the amount of $350,000 as well as costs, interest and attorney’s fees.” The customer sought $350,000 in damages and the case was settled for $123,935.92.
- July 2018. “Claimants allege that material facts and the risks associated with an unregistered investment in Woodbridge Mortgage Investment Fund purchased in September 2013, January 2014 and July 2016 were not disclosed. Claimants also allege that material facts involving Future Income Payments, LLC, another unregistered investment, purchased in October 2014 were also not disclosed. Plaintiff is seeking recovery of damages in the amount of $900,000 as well as costs, interest and attorney’s fees.” The customer sought $900,000 in damages and the case was settled for $405,247.75.
- June 2018. “Customer alleges that he was misled regarding an unregistered investment in Woodbridge Mortgage Investment Fund purchased in August 2014. Customer is seeking the return of his investment ($65,000).” The customer sought $65,000 in damages and the case was settled for $20,000.
- June 2018. “Claimant alleges that in February 2015 and November 2015 she was sold unregistered and misrepresented investments. Claimant further alleges that in September and December 2016, she was advised to roll over the investments and that they are now worthless. Claimant seeks to recover damages of at least $170,000 in lost principal as well as lost interest, reasonable costs and attorneys’ fees.” The customer sought $170,000 in damages and the case was settled for $45,000.
- April 2018. “Plaintiff alleges that material facts and the risks associated with an unregistered investment purchased in Woodbridge Mortgage Investment Fund in December 2013 were not disclosed. Claimant seeks recovery of damages in the amount of at least $400,000.” The case was settled for $155,958.52.
- March 2018. “Claimant alleges that in July 2015, April 2016 and December 2016 he was sold unregistered and fraudulent investments in Woodbridge Mortgage Investment Fund . Claimant seeks to recover damages of at least $550,500 and lost opportunity costs, punitive damages, costs and interest.” The customer sought $550,500 in damages and the case was settled for $241,275.15.
- January 2018. “Claimants allege that in November 2013 and July 2014 they were sold unregistered and fraudulent investments in Woodbridge Mortgage Investment Fund. Claimants seek to recover damages of at least $100,001 and lost opportunity costs, punitive damages, costs and interest.” The customer sought $100,001 in damages and the case was settled for $39,359.94.
Pursuant to FINRA Rules, member firms are responsible for supervising a broker’s activities during the time the broker is registered with the firm. Therefore, NYLife Securities LLC may be liable for investment or other losses suffered by New’s customers.
Erez Law represents investors in the United States for claims against brokers and brokerage firms for wrongdoing. If and have experienced investment losses, please call us at 888-840-1571 or complete our contact form for a free consultation. Erez Law is a nationally recognized law firm representing individuals, trusts, corporations and institutions in claims against brokerage firms, banks and insurance companies on a contingency fee basis.
"*" indicates required fields
