How Investors Can Avoid Fraud Schemes

BiggerPockets Daily

One of the biggest real estate investment fraud schemes in recent

history has been exposed. Wells Real Estate Investment promised

investors that their money would be used to buy, renovate, and develop

commercial and residential properties across South Florida. Instead,

they gambled $28 million of $58 million in investor funds on speculative

options and futures trading.

Surprise, surprise—they lost almost $12 million in the process.

The 660 investors who trusted Wells with their money are undoubtedly in a

tough position. However, while the SEC has filed a complaint against

the company, who knows if investors will ever see recourse for the

crimes committed?

So let this be a cautionary tale: Fraudsters are out there. Wells had

been in operation since 2017—not all that long, comparatively, but seven

years is plenty of time to scam people.

So how do real estate investors—especially those just entering this

industry—avoid fraudsters, scammers, and ne’er-do-wells?

Keep reading the article here: https://www.biggerpockets.com/blog/principles-for-avoiding-real-estate-fraud

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