FINRA Files Cease-and-Desist Order Against WR Rice Financial Services and its Owner Joel Wilson for Fraudulent Conduct
FINRA Also Issues Complaint Charging Wilson and WR Rice Financial With Fraudulent Sales of Limited Partnerships Wilson Controlled
WASHINGTON — The Financial Industry Regulatory Authority (FINRA) announced today that it has filed a Temporary Cease-and-Desist Order (TCDO) to halt further fraudulent sales activities by Michigan-based WR Rice Financial Services and its owner Joel I. Wilson, as well as the conversion of investors’ funds or assets. FINRA also issued a complaint against WR Rice and Wilson charging fraud in the sales of limited partnership interests in entities affiliated with the Diversified Group and American Realty Funds Corporation, companies in which Wilson has ownership interest and control. FINRA is filing the TCDO based on the belief that ongoing customer harm and depletion of customer assets would likely continue before a formal disciplinary proceeding against WR Rice and Wilson could be completed.
In its complaint, FINRA alleges that WR Rice, Wilson and other registered representatives at the firm sold more than $4.5 million in limited partnership interests to approximately 100 investors from predominantly low-to-moderate-income households, while misrepresenting or omitting material facts. FINRA charges that Wilson and WR Rice raised funds promising that the proceeds would be invested in land contracts on residential real estate in Michigan, paying an interest rate of 9.9 percent, when in fact, investors’ funds were used to make unsecured loans to companies Wilson owned or controlled. In addition, FINRA alleges that WR Rice and Wilson failed to disclose to investors that Wilson extended the improper loans due to an inability to pay them as they became due.
Wilson is also charged with providing fabricated documents to FINRA related to the limited partnership offerings, and with failing to provide full and complete testimony during FINRA’s investigation of him and his firm after he was confronted with the falsified documents.
Call Wittenberg Law at 310-295-2010 if you have concerns about your investment losses related to this or any other investment. Wittenberg Law can help you recover losses that were the result of misconduct or negligence.