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Woodbridge CEO Pleads Guilty to $1.3 Billion Fraud

By George C. Miller of Shustak Reynolds & Partners, P.C. posted on Wednesday, August 14, 2019.

Robert Shapiro, the ex-CEO of the Woodbridge Companies, has pled guilty to orchestrating a $1.3 billion fraud impacting more than 7,000 investors across the country, according to prosecutors in Miami.  According to a statement prepared by his lawyer, “Shapiro has taken personal responsibility for the failure of Woodbridge.  His guilty plea follows his decision to voluntarily place hundreds of millions of dollars of assets under bankruptcy court supervision and the consensual resolution of the SEC enforcement investigation….” 

The Woodbridge Group promised investors guaranteed returns as high as 10% from investments in loans tied to property developments.  Rather than investing those funds, Woodbridge allegedly used much of its new investment capital to repay prior investors – a classic Ponzi Scheme tell-tale.  Shapiro and other former executives are alleged to have pocketed upwards of $95 million in the fraud, hiding funds through a network of hundreds of sham companies. 

Woodbridge reportedly employed a vast network of unlicensed or previously-licensed individuals to promote its investments across the country.  There remain a number of ongoing FINRA, SEC and state securities regulator investigations and enforcement actions involving the sale of Woodbridge products.   

Shustak Reynolds & Partners, P.C. focuses its practice on securities and financial services law and complex business disputes. 
We represent many broker-dealers, registered representatives, investment advisors, investors and businesses. 
Partner George C. Miller can be reached in the firm’s San Diego office at (619) 696-9500. 

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