Did Your Broker Recommend You Invest In The Deeproot Funds?
You May Be The Victim of a $58M Ponzi Scam
More than one year after the US Securities and Exchange Commission (SEC) filed a civil lawsuit against deeproot Funds and its owner Robert J. Mueller accusing them of running an alleged $58M Ponzi Scam that defrauded nearly 300 investors, these same alleged victims are still struggling to recover their losses without a securities attorney. Unfortunately, waiting for the SEC’s case to conclude very likely won’t help deeproot investors get most, or maybe even any, of their money back. The Commission’s main priorities in these types of complaints are to hold parties that violate securities laws responsible and issue sanctions and penalties against them.
This is why if you are a deeproot investor, it is important that you explore your legal options with the help of a skilled Texas securities lawyer. You will want to go after your broker-dealer or financial advisor that recommended this speculative, unregistered, risky private investment vehicle while very likely failing to conduct the proper due diligence to ensure that the deeproot Funds were legitimate investment ventures.
Were the Deeproot Funds Misrepresented To Investors?
Deeproot, which is a San Antonio, TX-based investment adviser, and Mueller offered the deeproot 575 Fund, LLC and the deeproot Growth Runs Deep Fund, LLC (dGRD Fund) to investors, including retirees and other retail customers. According to the SEC, investors cashed out IRAs and annuities in order to invest because the Funds, which were supposed to invest in life insurance policies and deeproot-related business, were allegedly misrepresented as being relatively safe.
Mueller and deeproot would go on to raise over $58M from investors of both the dGRD Fund and the 575 Fund. However, claims the SEC, along with co-defendant Policy Services, they allegedly spent just $10M on life insurance policies while commingling the rest of the monies.
The defendants purportedly used most of the 575 Fund and dGRD Fund assets, nearly all of which were from investors, to support Mueller’s deeproot-affiliated businesses and his own expenses. This allegedly included using $1.5M of the Funds’ money on his family’s lifestyle. Also, from 2016 to 2020, claims the SEC, Mueller purportedly took about $1.6M of the commingled funds to make ad hoc salary payments to himself.
The SEC is accusing deeproot of making over $820K in Ponzi-like payments to earlier investors of the Funds from money that mainly came from newer investors.
Recover Your Deeproot Investment Losses with a Securities Attorney
Considering the allegations against deeproot and the investors’ resulting losses, the dGRD Fund and the 575 Fund were likely unsuitable for any investor. Your financial adviser may have failed to conduct the proper due diligence into deeproot and its Funds. If so, you may be able to pursue damages against your broker-dealer with a securities lawyer. This is not the type of securities claim that you will want to make without expert legal representation.
In Texas and throughout the US, our experienced securities attorneys and investment fraud lawyers at Shepherd Smith Edwards and Kantas (investorlawyers.com) are helping investors pursue Financial Industry Regulatory Authority (FINRA) arbitration claims against their broker-dealers for unsuitably recommending that they invest in the deeproot Funds.
How To Contact Our Deeproot Investor Losses Lawyers
Throughout the US, call (800) 259-9010
In Houston, call (936) 251-0033
In Dallas, call (214) 613-5306