California Real Estate Fraud Report

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08
Feb

Wells Fargo, Greenberg Traurig Sued for Real Estate Investment Fraud

Banking giant Wells Fargo and international law firm Greenberg Traurig are defendants in a lawsuit by an investor who claims the two firms concocted a scheme to hide the shaky financial status of a loan brokerage.

Investor David Nolan claims in his lawsuit, filed in Alameda County, that the loan broker – RE Loans, LLC, failed to disclose its poor liquidity status. Greenberg Traurig, RE Loans’ outside counsel, is accused of conspiring with Wells Fargo to conceal its shortage of capital by getting Wells to extend the broker $50 million worth of credit. This is despite the fact that both firms knew that RE Loans was forbidden in its investor agreements from taking on third party debt.

As a result of the deception, Nolan alleges that he lost about $665,000 that he had invested with RE Loans. His causes of action against Greenberg Traurig include aiding and abetting breach of fiduciary duty, fraud by misrepresentation, fraud by concealment, and secondary liability for securities fraud.

Read the original article in American Lawyer.

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The information and notices contained on The California Real Estate Fraud Report are intended to summarize recent developments in real estate fraud, mortgage fraud, short sale fraud, REO fraud, appraisal fraud, loan modification scams, loan modification fraud and other real estate related crimes occurring in Los Angeles and California. The posts on this site are presented as general research and information and are expressly not intended, and should not be regarded, as legal advice. Much of the information on this site concerns allegations made in civil lawsuits and in criminal indictments. All persons are presumed innocent until convicted of a crime. Readers who have particular questions about real estate fraud, mortgage fraud and appraisal fraud matters or who believe they require legal counsel should seek the advice of an attorney.

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