What Happened to Pacific Private Money Group? SEC and Chapter 11

Who and what: one name, thirteen debtors

Searching “Pacific Private Money” brings up several different things, and the court papers separate them. Pacific Private Money Group LLC is the Delaware parent. Pacific Private Money, Inc. (PPMI) is the licensed operating company that originated and serviced the loans. The funds are separate LLCs that pooled investor money. The Debtors' own motion describes an “opco/fundco” structure: PPMI lent money raised from the funds, from individual “Trustee Investors” and from debt facilities. Which one you hold matters for everything below.

Seven more entities are in the same joint administration, including Private Money Management Group LLC, Pacific Mortgage Capital LLC, Pacific Southwest Note Fund LLC, Pacific Opportunity Fund LLC and Arrival Fund I, LLC (the committee's October 13, 2026 filing lists all thirteen). Check which estate your fund sits in: the court docket shows the SEC's two funds as 26-30534 (Fund I) and 26-30532 (Freedom Fund), while 26-30536 is Pacific Private Money Partners LLC, not a fund named in the SEC complaint.

What the SEC alleges, and what the two executives admitted

The SEC filed its civil complaint on September 1, 2026 (No. 3:26-cv-09298, Northern District of California) against the founder and former chief executive of PPMG and a former chief operating officer of its subsidiary Pacific Private Money, Inc. We do not name them; they are in the filings. The complaint alleges, and the two consented to judgments without admitting or denying:

The U.S. Attorney's Office for the Northern District of California filed a criminal Information on August 31, 2026 (No. 3:26-cr-00434). Its release of September 30, 2026 says the former chief operating officer pleaded guilty to wire fraud conspiracy on September 23, 2026 and the former chief executive pleaded guilty to wire fraud conspiracy and money laundering on September 30, 2026. The two “admitted to defrauding Pacific Private Money investors through false statements and omissions about the negative financial situation of Pacific Private Money’s various investment funds”, and agreed that they would be “responsible for restitution to victims of no less than $71,790,425”. The criminal scope is wider than the SEC's: the Information says about $103 million from more than 175 investors, the release says about $106.7 million. Maximum sentences are 20 years for wire fraud conspiracy and, for the former chief executive, 10 for money laundering; sentencing is February 10, 2027 (chief operating officer) and February 17, 2027 (chief executive), both at 10:00 a.m. before Judge Jacqueline Scott Corley.

Because both pleaded guilty, the criminal admissions are established facts in that case. The SEC's remedies are still open: the consent judgments are “subject to court approval” and money amounts are to be set later, and we did not find an entered judgment.

How much was raised: five sources, five answers

The same funds produce very different totals depending on who is counting and what period is covered.

The Form D total is the highest because it counts sales since each fund opened (Pacific Private Money Fund I's first sale was July 9, 2013) and does not net out redemptions or distributions paid in the meantime. None of these is the amount an investor can claim: the Debtors scheduled investor claims in Pacific Private Money, Inc.'s schedules at their “best estimate of each investor's capital account as of the Petition Date”.

What the Form D filings showed

PPMG's funds were sold under Rule 506(c), the exemption that allows advertising and webinars if every buyer is verified as accredited. The group's funds filed Form D notices with the SEC; we read all of them for the five funds that file under their own names.

Three things stand out when the forms are read next to the complaint (our reading, not a finding):

• The forms never showed a problem. Pacific Private Money Fund I reports $73.5 million sold on March 5, 2025, seven months before the SEC says distributions stopped; no field on a Form D shows whether the fund earned its distributions. The SEC alleges it had been unprofitable since the year ending December 31, 2021.
• Long gaps between amendments. Fund I's filings are dated March 13, 2020 and March 5, 2025, with none in between, while the SEC says it kept selling to new investors; our Form D guide sets out when amendments are required for a continuing offering. Freedom Fund shows August 27, 2021 and then March 5, 2025.
• The minimum fell from $500,000 to $1,000. Freedom Fund opened in 2020 at a $500,000 minimum and, by its 2025 filing, accepted $1,000. A lower minimum can bring in more and smaller investors; on its own it proves nothing. The 2025 filings also say no non-accredited investors had bought, consistent with the 506(c) exemption (see our 506(b) versus 506(c) census).

A Form D does not list the fund's lenders, loan quality or intercompany loans, which the complaint says were the core of the problem.

Chapter 11: who runs it and what the docket shows

All 13 entities filed on June 16, 2026 in the Bankruptcy Court for the Northern District of California and are jointly administered under 26-30538, before Judge William J. Lafferty. Facts from the public docket and the filings we could read:

The Debtors' own account is different from the SEC's in emphasis: their motion says a significant part of the funds' portfolios became non-performing after defaults by a few large borrowers (about $10 million, over $20 million and about $12 million), a rise in rates shrank the secondary market for the loans, and “By 2023, redemption requests across the Funds exceeded available cash”. It adds that, as of the petition date, the principal assets were about 45 mortgage and note assets, about ten foreclosed properties, cash, intercompany receivables and equity interests in affiliates, that the properties were not appraised, and that the Debtors “believe that there is substantial equity in the Properties”. Treat that last sentence as a debtor's view, not a valuation.

What is recoverable

We saw no plan, disclosure statement or distribution estimate on the docket. The figures that exist:

Two details shape the outcome. The committee told the court that proving how closely the entities were intertwined could “consume a significant portion of the money available to victims”, which is why it proposes to ask first on the evidence already gathered. And the schedules say investor claims are shown at each investor's capital account as the Debtors estimate it, which can differ from what a statement showed. A separate group, “Trustee Investors”, holds fractional interests in individual loans secured by deeds of trust; one August 2026 motion by several of them, over a $1,000,000 note on a Cotati property, claimed $918,277.60 was owed and asked to lift the stay. Those holders may be in a different position from LLC members.

What the record does not show

• Whether the bar date moved. The lead docket page, last updated October 16, 2026, shows October 19, 2026 as the last date to file claims. The debtors asked on September 23, 2026 to extend it, and a hearing was set for October 14, 2026. We found no entered order on the pages we could read.
• Whether an LLC member must file a claim, or what deadline the court set for equity interests. Read your notice or ask counsel; do not assume.
• A state regulator's order. California's Department of Financial Protection and Innovation has an enforcement entry against the group; its PDF would not load for us, so we do not rely on it.
• The entry of the SEC judgments, and any receiver. We found no receiver; the cases are Chapter 11 with the debtors in possession.
• Borrowers. PPMI also made loans to borrowers. The docket does not say who now services them; use your servicing notices, and see our California hard money lenders page if you are looking for a lender.

What an investor can do with this

1. Gather your papers now: subscription agreement, offering memorandum, statements, K-1s and every email promising returns or liquidity. The SEC alleges the former chief executive directed the creation of false account statements and Schedule K-1 forms, so keep what you were sent and compare it with the Debtors' schedule.
2. Check your claim in the right estate. Find your fund in the table above (26-30534 for Fund I, 26-30532 for Freedom Fund), look at the notice you were mailed, and compare your capital account with the Debtors' schedule. The official docket is on PACER; the free CourtListener copy of the lead docket is linked in the sources.
3. Ask the committee's counsel (Fox Rothschild LLP is listed on the docket) what investors need to file and when. Counsel for the committee represents unsecured creditors as a group, not you personally.
4. Talk to a securities or bankruptcy attorney before the date passes if you cannot tell whether you must act. Be careful with unsolicited recovery offers, and ask who pays whom.
5. Check who sold it to you. If an adviser or broker recommended a PPMG fund, look the person up on FINRA BrokerCheck and the SEC's adviser search, and keep your suitability paperwork. Claims against selling firms have their own deadlines.
6. Ask a tax professional about the loss and the year. The rules for a loss on a failed fund are different from those for a stock; our worthless securities page shows how the IRS text is built, for securities, not for this case.

How to check a private lender or fund before you invest

The PPMG case is a reminder of what a retail investor can test in an afternoon. Each check below is something this case shows can fail or be missing:

• Find the Form D on EDGAR. Search the issuer's name; compare the amount sold, the investor count and the minimum across the years (see the table above). Our Form D guide explains each field. A Form D is a notice, not an audit.
• Ask what the fund actually owns. The complaint says the Freedom Fund's largest “loan” category was unsecured loans to other PPMG entities. Ask for a loan-level schedule and whether any loans are to affiliates.
• Be wary of fixed returns plus short liquidity. The Freedom Fund was marketed with 9% on large deposits and 30-day liquidity, according to the complaint. Where the cash for redemptions comes from is the question to ask.
• Read how the manager is paid. The complaint says the Pacific Fund's manager earned 2% of assets plus 50% of excess cash, and the Freedom Fund's manager 100% of net income after the fixed return. Compare with our private money lender page on how to check one.
• Check the license and the people. Look up the lender's state license and the individuals on FINRA BrokerCheck or the SEC adviser search, and ask for audited financials of the fund itself, not the sponsor.
• See who else is in the room. Three WE Alliance funds sued the group in April 2026, two months before bankruptcy: litigation shows up on court dockets months before investors hear of it.

FAQ

This is analysis of public documents, not investment, legal or tax advice.

Sources, read on October 19, 2026: SEC press release 2026-82 and litigation release 26627 (September 1, 2026 and September 4, 2026) and the complaint in SEC v. two former PPMG executives, No. 3:26-cv-09298 (N.D. Cal., Doc 1); U.S. Attorney's Office, Northern District of California, press release of September 30, 2026 (updated October 1, 2026) and the Information in No. 3:26-cr-00434 (Doc 2); SEC EDGAR Form D and D/A filings of Pacific Private Money Fund I, LLC (CIK 1581800, accession 0001581800-25-000003 and five earlier), Pacific Freedom Fund, LLC (CIK 1809220, 0001809220-25-000003 and two earlier), Pacific Southwest Note Fund LLC (CIK 1819863), Pacific Opportunity Fund LLC (CIK 1964269) and Arrival Fund I, LLC (CIK 2043114); Bankr. N.D. Cal. docket In re Pacific Capital Funding Group, Inc., No. 26-30538 and related cases, as copied by CourtListener (docket 73492037), including Doc 84 (Debtors' motion on asset sale procedures), Doc 89, Doc 165 (committee status conference statement) and, in No. 26-30533, Doc 13 (schedules and global notes); the petition of Pacific Freedom Fund LLC, No. 26-30532, Doc 1. Quotes are verbatim from those documents. Allegations are the SEC's and are not findings of fact by a court; the two executives are not named here. Compiled by CrowdfundedWealth.