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Did You Lose Money Investing in Aequitas with Former RP Capital LLC Financial Advisor Aaron Maurer?

Posted on Saturday, March 30th, 2019 at 10:57 am    

Ponzi Scheme

Erez Law is currently investigating former RP Capital LLC financial advisor Aaron Maurer (CRD# 3007121) regarding Aequitas investment losses. Maurer has been registered with Ascendant Alternative Strategies, LLC in Austin, Texas since June 2018. Previously, Maurer was registered with Stephen A. Kohn & Associates, Ltd. in Lakewood, Colorado from April to May 2018 and with RP Capital LLC in Aliso Viejo, California from 2009 to 2016.

In March 2016, the Securities and Exchange Commission (SEC) filed a complaint against Aequitas Management, LLC alleging that the first and its subsidiaries operated a Ponzi-like scheme that defrauded 1,500 customers of approximately $350 million. Company executives – CEO Robert Jesenik, executive vice president Brian Oliver, and chief operating officer N. Scott Gillis – were aware that the company’s cash flow would make it difficult to meet existing obligations, but they continued to raise hundreds of millions of dollars from new investors to pay earlier investors.

According to the SEC complaint, Aequitas and its affiliates defrauded investors into believing they were making health care, education, and transportation-related investments, when their money was really being used in a last-ditch effort to save the firm. The SEC alleges that between January 2014 and January 2016, the firm raised money from investors by issuing promissory notes with high rates of return typically ranging from 8.5 to 10 percent.

Aequitas did use some investor money to acquire trade receivables in health care, education, transportation, and other consumer credit sectors, the SEC alleges that the vast majority was concentrated in student loan receivables of for-profit education provider Corinthian Colleges. However, Corinthian Colleges defaulted on its obligations to Aequitas in mid-2014, significantly exacerbating the firm’s already severe cash flow problems.

The Aequitas Funds include:

  • Aequitas WRFF I
  • Aequitas Private Client Fund
  • Aequitas Income Protection Fund
  • Aequitas ETC Founders Fund
  • Aequitas Income Opportunity Fund II
  • Aequitas Enhanced Income Fund
  • Aequitas Commodities Fund
  • Aequitas Capital Opportunities Fund
  • Aequitas Secured Subordinated Promissory Notes

Maurer received several custom complaints, which evolved into a civil litigation for direct investment and promissory note losses. The litigation was settled for $5,795,000.

Maurer has been the subject of five customer complaints between 2016 and 2017, according to his CRD report:

October 2017. “Customer’s allegation include inadequate suitability, fraud, misrepresentation, and lack of proper due diligence with respect to the sale of a private placement security issued by Aequitas. The claim does not state the dates of the allegations but transactions occurred between 2011 and 2015.” The customer sought $1,810,000 in damages.

September 2017. “Customers allegations include negligence, misrepresentation and omission of a material fact with respect to the sale of a private placement security issued by Aequitas. The claim does not state the dates of the allegations but transaction activity occurred between December 2013 and April 2014.” The customer sought $350,000 in damages.

September 2017. “Misrepresentation of fact, risks, and suitability when selling non-registered securities.” The customer sought $12,319,652 in damages.

September 2017. “Allegations include misrepresentation, conflict of interest, suitability and supervision failures as recommendations to investment in Aequitas were made.” The customer sought $700,000 in damages.

April 2016. “Customer claims negligence, over-concentration, breach of fiduciary duty, breach of contract, material misrepresentation and omissions, and failure to supervise regarding the customer’s purchase of illiquid alternative investments. The individual has been a client since 2009 but the claim does not pinpoint which investment and time frame the allegations occurred.” The customer sought $600,000 in damages.

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, RP Capital LLC may be liable for investment or other losses suffered by Maurer’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.