Fletchers Capital Group: SEC Alleges $4.25M Real Estate Note Fraud
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Quick Answer
On September 29, 2026 the SEC filed a civil complaint in the Northern District of Georgia (No. 1:26-cv-05623) alleging that between April 2021 and November 2024 a Georgia individual sold more than $4.25 million of promissory notes and similar “Investment Instruments” to about 100 investors through two companies, Fletchers Capital Group, LLC and Fletchers Multi-Family Real Estate Partners Fund, LP, promising returns of up to 80% or more annualized and doing no real estate development (SEC Litigation Release 26656, September 30, 2026). The complaint alleges that more than $2 million went to personal expenses and more than $2 million to payments to earlier investors, which together is at least 94% of the amount raised (our arithmetic on two “more than” figures). The SEC seeks an injunction, disgorgement with interest, a civil penalty and a bar on selling securities. It does not ask for a receiver or an asset freeze, and both companies are defunct. These are allegations; nothing has been proven. As of November 3, 2026 we could not read the docket for any later ruling.
Key Takeaways
- The SEC alleges more than $4.25 million raised from approximately 100 people nationwide between April 2021 and November 2024, using notes with a fixed amount, a maturity from a few weeks to a year and, in some, promised returns “as high as 80% or more on an annualized basis” (complaint paragraphs 1, 36 and 37).
- The complaint alleges that neither company did any meaningful real estate acquisition or operation, had no assets under management, and that the fund owned no property and held no “1st position” interest in any (paragraphs 29 to 32).
- Alleged use of the money: more than $2 million on personal expenses, including more than $790,000 in cash withdrawals and over $1 million sent to over 300 recipients through Zelle, Apple Cash and Cash App, and more than $2 million paid to earlier or complaining investors (paragraphs 61 to 63). Each is at least 47% of $4.25 million (our arithmetic).
- Two examples in the complaint: $75,000 invested on August 21, 2023 against a promised $90,000 by August 24, 2024, and $25,000 invested on June 20, 2023 against a promised $30,000 by October 20, 2023, which is 20% in 122 days, about 60% a year in simple terms (our arithmetic).
- The only SEC filing by either company is one Form D from the fund dated February 23, 2023: a $100,000,000 offering under Rule 506(b), $50,000 minimum, first sale “yet to occur” and $0 sold. It was never amended. The alleged $4.25 million is 4.25% of that offering size (our arithmetic).
- The complaint seeks no receiver and no asset freeze, so unlike receivership cases there is no court-run claims process to join yet. The relief sought is an injunction, disgorgement with prejudgment interest, a civil penalty and a securities-offering bar (prayer for relief II to V).
CSV · 58 rows
Fletchers Capital Group and Fletchers Multi-Family Real Estate Partners Fund: SEC complaint figures and Form D, 2021-2026
58 rows from SEC Litigation Release 26656, the complaint in Case 1:26-cv-05623 and the fund's Form D: amount raised, promised returns, alleged use of money, entity status, relief sought.
What the SEC says investors were sold
According to the complaint, the pitch ran through online real estate communities. It says the individual defendant “began appearing in such groups on online social media platforms including Facebook,” presented himself as an experienced real estate investor, and claimed the companies bought property below market value. A slide deck for Fletchers Capital referred to a “30+ deal track record of success.” The complaint alleges the reality was different: neither company engaged in “any meaningful real estate acquisitions or other business operations,” both “had no assets under management and only de minimus revenue” apart from investor money, and the fund did not own any property.
What the investor received was paper, not property. The complaint says most investments were documented in a “Promissory Note Agreement,” a “Promissory Note Agreement / Investment Agreement” or an “Investment Agreement,” and that the investments did not give investors limited partnership interests or any other interest in the (non-existent) properties.
| Term | What investors were told (per the complaint) | What the SEC alleges |
|---|---|---|
| Business | An experienced operator of profitable real estate development projects with a “30+ deal track record” | No meaningful acquisitions or operations; no assets under management (paragraphs 27, 29 and 30) |
| Use of money | Buy or develop specific properties: a six-unit container home development in southwest Atlanta, a new home on a named Atlanta avenue, Orlando apartments for short-term rentals | No connection to those properties; the money was not used for any other development either (paragraphs 44, 45, 49, 50 and 55) |
| Return | A fixed payout at a set maturity, a few weeks to a year, with some instruments at 80% or more annualized | Payments defaulted; later investors’ money paid earlier investors, “in classic Ponzi fashion” (paragraphs 5, 36 and 64) |
| Structure | Claims about a structure to protect passive investors and a “1st position” interest in property | The fund had no structure designed to lower the risk to passive investors, owned no property and held no “1st position” interest (paragraphs 31 and 32) |
| Excuses when payments stopped | Project delays, problems with unrelated properties | Alleged to be fabricated, including a letter on a financing company’s letterhead that the company said was fake (paragraphs 65 and 66) |
Source: SEC complaint, Case 1:26-cv-05623-SCJ (filed September 29, 2026), paragraphs as cited. These are the SEC’s allegations; no court has found them true.
How the numbers fit together
The complaint gives the raise and two big uses of it. Because each is a “more than” figure, the shares below are floors (our arithmetic).
| Item | Amount per complaint | Share of $4.25 million (our arithmetic) |
|---|---|---|
| Raised from about 100 investors | more than $4.25 million | 100% |
| Average per investor | about $42,500 | 4,250,000 divided by 100 |
| Personal expenses | more than $2 million | at least 47% |
| Payments to earlier or complaining investors | more than $2 million | at least 47% |
| Personal expenses plus payments to earlier investors | more than $4 million | at least 94% |
Source: SEC complaint, paragraphs 1, 61 and 63; shares are our arithmetic.
The personal-expense paragraph is specific: more than $790,000 in cash withdrawals, over $1 million in payments and transfers to over 300 recipients via Zelle, Apple Cash and Cash App, about $40,000 of travel and over $10,000 of exotic car rentals, plus rent, retail purchases and car payments (paragraphs 61 and 62). The complaint says many investors sent money by wire (paragraph 59).
Two of the dated examples show how the promised return worked. They are the complaint’s examples of the pitch, not a statement about every investor.
| Example | Invested | Promised back | Promised gain (our arithmetic) |
|---|---|---|---|
| Investor A, August 21, 2023 | $75,000 | $90,000 by August 24, 2024 | 20% in about 12 months |
| Investor B, June 20, 2023 | $25,000 | $30,000 by October 20, 2023 | 20% in 122 days, about 60% a year in simple terms |
| Orlando short-term-rental pitch, April 2022 | varied | Deck claimed $118,690 of historical profit, December 2021 to April 2022 | Complaint alleges no connection to the properties and no profits (paragraphs 53 and 55) |
Source: SEC complaint, paragraphs 40, 46, 53 and 55. The complaint does not name the investors.
The two companies and what is left of them
Per the complaint, Fletchers Capital Group, LLC was formed in March 2021 as a Georgia limited liability company with the individual defendant as its only member, and was administratively dissolved on September 19, 2025. Fletchers Multi-Family Real Estate Partners Fund, LP was formed in December 2022 as a Delaware limited partnership, controlled by the same person, and its Delaware registration was cancelled on June 1, 2025. Neither was ever registered with the SEC in any capacity, the complaint says. Neither company is named as a defendant; the case is against one individual.
The fund did file one notice with the SEC. EDGAR shows a single Form D for Fletchers Multi-Family Real Estate Partners Fund, LP (CIK 1964347), accession 0001964347-23-000001, dated February 23, 2023. A Form D is a notice the issuer files about itself; the SEC does not review or approve the offering, and filing one is not “registration.” Our guide to reading a Form D covers the limits.
| Form D field | Value reported February 23, 2023 | What the complaint alleges |
|---|---|---|
| Exemptions | Rule 506(b) and Section 3(c)(1) | Not registered with the SEC in any capacity |
| Total offering amount | $100,000,000 | More than $4.25 million raised, April 2021 to November 2024, through both companies |
| Amount sold | $0 (first sale “yet to occur”) | Instruments sold April 2021 to November 2024 through both companies |
| Investors | 0 | Approximately 100 across both companies |
| Minimum investment | $50,000 | Average about $42,500 per investor (our arithmetic) |
| Amendments | None filed | Sales continued to November 2024 |
Source: SEC Form D accession 0001964347-23-000001 (filed February 23, 2023); SEC complaint paragraphs 1, 18 and 37. The Form D was filed about two months after the fund’s formation date, and the complaint says most of the money was raised through the Georgia company’s instruments, so the two are not a like-for-like comparison.
The point for a reader is narrow. A $100 million Form D with a $50,000 minimum and no later amendment tells you the filer’s own description at one moment. It cannot tell you whether any money was ever raised or spent as described. Our 506(b) versus 506(c) census shows how many offerings use the same exemption.
What happens next, and what is not known
The SEC seeks a permanent injunction, disgorgement of “ill-gotten gains” with prejudgment interest, a civil penalty “in an amount to be determined by the court,” and a permanent bar on participating in the offer or sale of any security, except for the defendant’s own accounts. The SEC demanded a jury trial. The complaint was filed on September 29, 2026 and the SEC release is dated September 30, 2026.
- No receiver, no frozen assets requested. In several SEC cases a court appoints a receiver who collects assets and runs a claims process (see our page on the SQN receivership). Here the prayer for relief asks for none, so there is no court-run claim form to file.
- No amounts to investors are set. Disgorgement is a payment to the court or the SEC; the complaint does not say how or whether any money would reach investors, and the release does not either.
- Unknown to us: whether the defendant has answered, whether a settlement is being negotiated, and what assets exist. We could not read the docket; the case number is 1:26-cv-05623-SCJ in the Northern District of Georgia.
- Not covered by this page: any state or criminal matter, or any bankruptcy of either company. We did not find a primary document for either and do not state one.
What a reader can do with this
- If you invested in either company: collect the note or “Investment Agreement,” wire confirmations and every payment you received, and keep the pitch deck and messages. The SEC release is the public record of the action; check the docket of No. 1:26-cv-05623-SCJ in the Northern District of Georgia for filings.
- If you were paid back: the complaint calls payments to earlier investors “Ponzi payments.” Whether money paid to investors can later be questioned is a legal matter for a lawyer, not something this page can settle.
- If someone offers you a note in a Facebook real estate group: compare their promise with the arithmetic. Twenty percent in four months is about 60% a year (our arithmetic), and see our real estate notes guide for how note investing works; our red-flag checklist lists what to ask for first.
- If the pitch is short-term rentals: ask for the lease and the owner’s written permission to sublet; the complaint says the leases of the Orlando units it examined prohibit short-term sub-rentals. For how real short-term-rental loans are underwritten, see our short-term rental loan guide.
- Check the filer: search EDGAR for the company and read the Form D’s amount sold, minimum and exemption yourself, and search your state’s secretary of state for the entity’s status.
A loss on a private note can have tax and estate consequences that depend on your facts, including whether and when it can be deducted.
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Sources: SEC Litigation Release No. 26656 (September 30, 2026); SEC v. the individual defendant, Complaint, No. 1:26-cv-05623-SCJ (N.D. Ga., filed September 29, 2026, Document 1), read from the court-stamped PDF; SEC Form D accession 0001964347-23-000001 (February 23, 2023); EDGAR submissions record for CIK 1964347, checked November 3, 2026. The SEC’s allegations have not been proven. This is analysis of public documents, not investment, legal or tax advice.
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