Cardone Capital: What the SEC Filings Say About the Returns

Update, August 2026: the securities class action against Cardone Capital and Grant Cardone was certified on March 27, 2026 and a jury trial is set for March 9, 2027. We track the docket, the Ninth Circuit's reversal and what Funds V and VI report in their own audited filings in The Cardone Capital Class Action in 2026.

Why this review exists — and the correction it has to make first

Search "Cardone Capital review" and you will find two kinds of content: promotional pieces echoing Grant Cardone's own pitch ("15% annualized returns," "double your money," "passive income"), and outrage pieces claiming "Grant Cardone settled with the SEC." Both are wrong in opposite directions. This review exists to replace both with what the primary documents — SEC EDGAR filings and federal court opinions — actually say.

The most important correction up front, because it is the one most often repeated as fact: there was no SEC settlement and no SEC fine against Cardone Capital. Anyone telling you otherwise is repeating a misremembering of two separate, real events — a routine SEC staff comment letter, and a private investor lawsuit. We lay out both precisely below, because on a topic involving a litigious public figure, accuracy is not optional.

This review is built from the audited Reg A+ filings of Cardone's funds on SEC EDGAR — the Cardone Equity Fund V 1-K and 1-SA, the Cardone REIT I FY2025 1-K (filed April 30, 2026), and the Non Accredited Fund 1-SA — plus the Ninth Circuit's June 10, 2025 opinion in Pino v. Cardone Capital, the official court-approved class notice documenting the 2026 class certification and March 9, 2027 trial date, and the contemporaneous legal analyses. It belongs in the cautionary tier of CrowdfundedWealth's coverage alongside our reviews of real estate crowdfunding failures, the DiversyFund review (the Reg A+ app whose offering the SEC permanently suspended in 2023), and the platforms we explicitly do not recommend.

The two real regulatory events

Event 1 — the 2018 SEC staff comment letter (not a settlement)

When Cardone Equity Fund V went through Regulation A+ qualification in mid-2018, SEC staff reviewed the offering circular and, in a July 2018 comment letter, instructed Cardone to delete a projected "approximately 15% annualized return" and related monthly-distribution figures appearing on page 17 "and throughout the offering statement," on the basis that the projection lacked a reasonable foundation. Cardone complied in writing — the response was essentially "We have removed the references on pages 17, 26, and 32," with no defense of the number — and the fund was qualified.

This is a routine part of the SEC's disclosure-review process. It is not an enforcement action, a fine, or a settlement. The forensic significance is not the comment letter itself but what happened next: having agreed to remove the unsupported 15% projection from the legal document, Cardone continued promoting "15% annualized return" on Instagram and YouTube. That contradiction is the seed of the lawsuit.

Event 2 — Pino v. Cardone Capital (a live private class action)

Luis Pino, an unaccredited investor, sued in September 2020 over the 15% IRR and distribution claims used to market Funds V and VI; after he died in February 2023, his daughter and successor-in-interest, Christine Pino, became lead plaintiff. The case has produced two notable Ninth Circuit decisions:

• December 21, 2022 (No. 21-55564): The Ninth Circuit held that Cardone's mass social-media communications constituted "solicitation," making the promoter a statutory seller liable under Securities Act §12(a)(2) — a landmark ruling for influencer/securities liability.
• June 10, 2025 (No. 23-3512): On a second appeal, the court again reversed dismissal, holding that Pino adequately pleaded both objective and subjective falsity under the Supreme Court's Omnicare standard, and that omitting the SEC comment letter — even though it was public on EDGAR — could support a misstatement-or-omission claim. The court reasoned that Cardone's silent removal of the projection "evinces [his] subjective disbelief" in the very number he kept advertising.
• 2026 — class certified, trial scheduled (C.D. Cal., No. 2:20-cv-08499): On remand the district court certified the class, defined as anyone who acquired an interest in Cardone Equity Fund V or VI through their public offerings. Per the court-approved class notice, the exclusion (opt-out) deadline was July 14, 2026, and a jury trial is scheduled for March 9, 2027. Cardone asked the Ninth Circuit to review the certification under Rule 23(f); on June 1, 2026 the court denied the petition (No. 26-2252). This is the development most search results miss: the case is not dormant — it has cleared the pleading stage AND certification and is now headed to trial.

Two things must be said plainly. First, certification is not a finding of liability — it means the case can proceed as a class, but there has been no merits judgment, and the allegations remain unproven (Cardone denies wrongdoing). Second, this is a private securities class action, not a government action. Describing it as an "SEC case" or "SEC settlement" is simply wrong. But it is a real, live and now escalating legal overhang on the manager's core marketing conduct — a certified class with a 2027 trial date — and it is the single largest reason the Regulatory/Legal dimension scores 1.5.

Separately, in 2025–2026 two civil suits were filed against Grant Cardone personally — a defamation claim by a former Miss Universe Canada delegate (filed December 2025) and a whistleblower-retaliation/defamation claim by Cardone Capital's former chief marketing officer (filed May 2026). Both are unproven allegations, and neither concerns the funds' securities — but for a manager whose distribution engine is his personal brand, escalating personal litigation is a key-person risk worth noting. In parallel, Cardone Capital in 2026 pivoted part of its strategy toward Bitcoin (a hybrid real-estate-plus-BTC fund, with company statements about directing rental income into crypto) — a material strategy shift for investors who bought a multifamily-real-estate thesis.

The marketing-versus-reality gap

The promotional thesis is aggressive: "15% annualized," "double your money in 10 years," "monthly cash flow." The audited filings tell a different story.

A fund compounding at 15% does not report multimillion-dollar net losses and flat-to-declining net asset value. The Non Accredited Fund's 1-SA shows each property at a book loss, with "current book valuations significantly below the purchase price of the properties," though it attributes that loss "primarily to non-cash depreciation and amortization" and says the figures do not consider any market appreciation since acquisition. Rising rates also reached the payouts: Cardone Equity Fund XVIII told investors in July 2022 that its distribution "was impacted by a $67k increase in interest expense due to rising interest rates," and an independent blog reported the rate was cut from 6% to 4%. Funds V and VI, by contrast, held or raised their payout rates that year (Fund V from 4% to 4.5%, Fund VI at 4.5%).

The verdict on the headline number is unambiguous: the marketed "15% annualized return" is not supported by the filed financials. SEC staff said as much in 2018; the EDGAR filings confirm it through 2025.

The debt structure — the proximate cause of the losses

Cardone's multifamily portfolio was built substantially on floating-rate and mezzanine debt, which is what turned the 2022-2024 rate-hike cycle into net losses. The Cardone REIT I 1-SA discloses that, as of mid-2025, four of its five leveraged property entities carried floating-rate loans (three after the August 2025 refinancing, per the FY2025 1-K), with interest-rate caps as high as roughly 5.1%-6.25% on senior debt and 7.5%-8.1% on mezzanine debt. As the SOFR base rose, interest expense climbed faster than rents, compressing distributable cash and driving the reported losses.

There is some 2025 deleveraging to credit honestly: the REIT I 1-SA discloses that one floating-rate loan was refinanced in August 2025 into a five-year fixed loan at 4.90%, and Cardone has publicly emphasized a shift toward all-cash and fixed-rate acquisitions. But the existing portfolio's rate exposure is the reason a "passive income" pitch produced distribution cuts and net losses in the prior cycle, and it remains the dominant risk factor.

The fee and promote structure

The economics flow toward the manager. Per the Reg A+ filings, Cardone Capital takes:

Three layers of 1% fees plus a 20% to 35% promote is a manager-favorable structure, and it is worth knowing that nobody else is being paid to sell you into it: all 26 Form D filings across the 22 Reg D funds report $0 in sales commissions and $0 in finders' fees, so the money that a conventional sponsor pays a broker-dealer network stays inside this structure rather than reaching the investor. After fees and the carried interest, a large share of any upside accrues to the manager — which sharpens the conflict between the marketing (which maximizes capital raised) and the investor's net outcome. Grant Cardone does co-invest (the filings show he typically owns 1% to 5% of each property-owning LLC alongside the funds), which provides some alignment, but it does not offset the promote.

Access — the one genuine strength

To be fair where fairness is due: the $5,000 minimum on the Reg A+ funds is a real democratizing feature — assuming you can still get in, and the Cardone Non Accredited Fund's own filings show it has raised one dollar in thirteen months and no SEC qualification notice issued on that offering between September 2023 and September 4, 2026. It gives a non-accredited investor exposure to institutional-scale multifamily real estate that would otherwise require accreditation or six-figure minimums — the kind charged by an accredited-only fund like the Origin Investments IncomePlus Fund at its $100K entry point. And because Reg A+ Tier II requires audited annual 1-Ks and semiannual 1-SAs filed on EDGAR, the transparency at the filing level is better than most fully private syndications — which is precisely why this review can be written from primary documents at all. The funds own real, titled Class A apartment properties, not paper or crypto. Those are genuine positives, and they are why Accessibility scores 3.5 and the overall rating is 2.0 rather than lower.

The catch is liquidity. These are long-horizon vehicles — roughly a 10-year hold — with little or no redemption program. Capital is locked. An investor attracted by the "monthly cash flow" pitch needs to understand that the principal is illiquid for the better part of a decade.

ProsCons

FAQ

Verdict

Cardone Capital earns 2.0 out of 5 in this forensic, cautionary review — and the rating is built on primary documents, not vibes. The legitimacy question has a nuanced answer: it is a real, SEC-reporting Reg A+ fund manager that owns real apartments and files audited financials, and its $5,000 minimum genuinely democratizes access. Those facts keep it out of the bottom tier.

What pulls it down to 2.0 is the gap between what is marketed and what is filed. SEC staff rejected the "15% annualized return" projection in 2018; the EDGAR filings show net losses ($5.26M in FY2025) and a widening accumulated deficit through 2025; rising interest expense hit at least one fund's 2022 distribution; the fee-and-promote structure favors the manager; and a federal securities class action over the core marketing conduct is not just live but certified, with a jury trial set for March 9, 2027 after two Ninth Circuit reversals. The single thread connecting all of it is a marketing engine — Grant Cardone's personal brand — that has consistently described an investment more attractive than the one the audited numbers describe.

For a non-accredited investor drawn in by the "15% / double your money / passive income" pitch, the honest forensic conclusion is: read the actual 1-K and 1-SA filings on EDGAR before sending a dollar, understand that the principal is illiquid for roughly a decade, and weigh the live litigation and the documented marketing-versus-reality gap. We do not recommend Cardone Capital. We earn nothing from it, and this review links only informationally to its SEC filings — which are, in the end, the most useful thing the company has produced for a prospective investor.

Sources

Primary SEC EDGAR filings:

• Cardone Equity Fund V (CIK 1741665) — annual report on Form 1-K (FY2024, filed December 29, 2025)
• Cardone Equity Fund V — semiannual report on Form 1-SA
• Cardone Equity Fund V — original Form 1-A offering statement (2018)
• Cardone REIT I (CIK 1882616) — semiannual report on Form 1-SA
• Cardone Non Accredited Fund (CIK 1915521) — semiannual report on Form 1-SA
• EDGAR company search — all Cardone entities

Court and legal analysis:

• Pino v. Cardone Capital — Ninth Circuit opinion, June 10, 2025 (No. 23-3512)
• Pino v. Cardone Capital — official court-approved class notice site (certification, opt-out July 14 2026, trial March 9 2027)
• Cardone REIT I FY2025 Form 1-K (SEC EDGAR, filed April 30, 2026)
• Morgan Lewis — Ninth Circuit holds social-media posts can give rise to Securities Act liability (2022 decision)
• Duane Morris — Ninth Circuit clarifies §12(a)(2) misstatement claims under Omnicare (2025)
• National Law Review — failure to push back on an SEC comment as evidence
• InvestmentNews — court revives lawsuit over 15% fund-return promise

Context:

• The Real Deal — 2020 class-action filing against Grant Cardone
• BBB profile — Cardone Capital, LLC

Related CrowdfundedWealth coverage:

• Cardone Capital Alternatives in 2026: The Exit You Don't Have
• Real Estate Crowdfunding Failures
• Best Real Estate Crowdfunding for Non-Accredited Investors 2026
• Real Estate Crowdfunding for Beginners
• Bankruptcy-Remote Real Estate Crowdfunding Platforms