The SEC on Wednesday charged five former real estate executives who allegedly defrauded investors into believing they were funding the development of five-star destination resorts in Florida and Las Vegas when they were actually buying into a Ponzi scheme.
According to the SEC complaint filed in U.S. District Court for the Southern District of Florida, Cay Clubs Resorts and Marinas raised more than $300 million from nearly 1,400 investors nationwide through a network of hundreds of sales agents, marketing seminars and podcasts that touted the profitability of purchasing units at Cay Clubs resort locations.
Investors were promised immediate income from a guaranteed 15% return and a future income stream through a rental program that Cay Clubs managed, the SEC said.
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