$142M high-yield investment fund accused of running Ponzi scheme, misappropriating investor funds

From Yahoo Finance: 2025-04-23 15:41:00

An Austin real estate lender is accused of running a Ponzi scheme from the start, using new investor funds to pay off earlier investors. The firm, CCG Capital Group, overstated its capital base by tens of millions, distributing profits on loans that didn’t exist, and funding personal expenses with investor money.

The receiver overseeing the wind-down of the Pride of Austin High Yield Fund I LLC alleges widespread misrepresentation, self-dealing, and misappropriation of investor funds. Insider loans were omitted from documents, tax returns weren’t filed, and accounting activity dropped off despite stable distributions to investors. Creditor claims amount to $10.1 million.

Robert Buchanan, the fund’s founder, is cooperating with the sale of assets but disputes the findings. The court will approve a distribution plan once assets are fully monetized. So far, 37 creditor claims have been filed totaling $10.1 million. The receivership is in its early stages, and recovery for investors is uncertain.

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