The Securities and Exchange Commission today charged Californian Matthew J. Skinner and five of his companies for conducting four unregistered and fraudulent real estate offerings between 2015 and 2020. The companies involved are Empire West Equity Inc., Bayside Equity LP, Longacre Estates LP, Freedom Equity Fund LLC, and Simple Growth LLC. More than $9 million was raised from 100-plus investors.
According to the SEC, Skinner, who claimed to be a successful real estate investor and dealmaker, made multiple misrepresentations to investors and misused millions of dollars of funds. While those investors were told their money would be directed toward specific projects or investments, often with “guaranteed” double-digit annual returns, he actually spent them on European vacations and payments for a Maserati and an Aston Martin. He allegedly siphoned off additional funds for unrelated operational and marketing expenses and made Ponzi-like payments to others.
“According to the SEC’s complaint, Skinner owes investors millions of dollars, and he falsely blamed the COVID-19 pandemic for his failure to pay them, telling investors their money was safe when in fact he had spent it all,” The SEC said in a release. “The SEC alleges that Skinner used these false statements to pressure certain investors to extend their investment terms.”
“Skinner allegedly defrauded investors with false promises while misappropriating their money,” said the SEC’s Los Angeles Regional Office director Michele Wein.
Skinner, Empire West, Longacre Estates, Bayside Equity, Freedom Equity Fund, and Simple Growth were charged with violating the securities registration requirements of Sections 5(a) and 5(c) of the Securities Act of 1933 and the antifraud provisions of Section 17(a) of the Securities Act and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5. He is further charged with violating the broker-dealer registration requirements of Section 15(a) of the Exchange Act. Injunctions are sought to permanently bar him or any entity he controls from raising money through unregistered offerings and from obtaining or receiving money related to or derived from Longacre Estates LP or Bayside Equity LP, or their underlying real estate projects.