SEC Charges Florida Man and French National with $40 Million Securities Fraud
The Securities and Exchange Commission announced that it filed charges against Paulo Fernando De Bastos, a Florida real estate agent, Joao Pedro Fonseca, a resident of France, and four companies they owned or controlled for their roles in an alleged real estate investment fraud in Detroit, Michigan.
The Securities and Exchange Commission announced that it filed charges against Paulo Fernando De Bastos, a Florida real estate agent, Joao Pedro Fonseca, a resident of France, and four companies they owned or controlled for their roles in an alleged real estate investment fraud in Detroit, Michigan.
The SEC’s complaint alleges that from 2016 to early 2020, the two half-brothers conducted a fraudulent, unregistered securities offering, raising more than $40 million from more than 250 investors in connection with the sale and management of investment properties in Detroit, Michigan.
According to the SEC’s complaint, De Bastos, Fonseca, RBF Trust LLC, and other companies that were owned and controlled by De Bastos and Fonseca, sold more than 900 properties to investors without actually owning the properties they were selling in a majority of the transactions. De Bastos and Fonseca allegedly represented to investors that they would manage the properties and guarantee they had paying tenants on behalf of the investors. Instead, the SEC says the defendants misappropriated the investor funds for their personal use.
The SEC seeks permanent injunctive relief, disgorgement of ill-gotten gains with prejudgment interest and civil penalties against all defendants, as well as officer-and-director bars against De Bastos and Fonseca.
