SEC, South Florida Developer Rishi Kapoor Reach Settlement
"Mr. Kapoor expresses his love for and thanks to the U.S. and looks forward to closing this chapter of his life and moving forward," said Fred A. Schwartz, a partner at Shahady & Wurtenberger.
November 14, 2024 at 01:44 PM
3 minute read
Real EstateWednesday evening, the U.S. Securities and Exchange Commission filed an unopposed motion for entry of consent judgment in the Miami state court litigation involving Rishi Kapoor, a politically connected South Florida developer whom the agency accused of ripping off millions of dollars from dozens of investors.
Fred A. Schwartz, a partner at Shahady & Wurtenberger, who represented Kapoor, said he was pleased to have reached a settlement in this case regarding liability.
"We had a professional and productive relationship with the SEC counsel and are grateful to the Commission for approving the settlement," Schwartz said. "Mr. Kapoor expresses his love for and thanks to the U.S. and looks forward to closing this chapter of his life and moving forward."
On Dec. 27, the SEC filed an emergency action against Kapoor, Location Ventures, Urbin and its subsidiaries and affiliated companies.
The SEC claimed that the defendants ran a real estate investment scheme in violation of the anti-fraud provisions of the federal securities laws, from January 2018 through March 2023 where they raised about $93 million from more than 50 investors.
On the same day, the Court entered an Order granting the asset freeze motion and Kapoor initially intended to challenge it.
Now, the SEC stated in the motion that the agency obtained a settlement from Kapoor. The terms of the settlement include that, without admitting or denying the allegations, Kapoor has agreed to the entry of a proposed judgment that grants the SEC’s request for a permanent injunction.
As part of the settlement, Kapoor is barred for five years from serving as an officer or director of any company with securities registered under Section 12 of the Securities Exchange Act of 1934 or that is required to file reports under Section 15(d) of the Exchange Act.
In addition, as part of the agreement, Kapoor agreed to comply with the terms of 17 C.F.R. § 205(e), so he will be prohibited from denying, directly or indirectly, any allegation in the complaint or creating the impression that the complaint is without factual basis.
“The Court’s entry of the proposed Judgment will resolve issues of liability and provide for entry of non-monetary relief against Kapoor," according to the motion. "If entered by the Court, the Commission’s only remaining issues in this case would be the Commission’s claims for disgorgement with prejudgment interest and civil penalties against."
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