Following an FBI investigation of the now defunct Palatine, Illinois-based real estate investment company Michael Franks, LLC, federal prosecutors have charged Michael Morawski and Frank Constant with fraud.
Federal prosecutors allege that between 2006 and 2010, Michael Franks raised more than $16 million from at least 300 investors by offering passive ownership interests in various multi-family residential properties located in Illinois, Texas and Alabama. The defendants represented that they would use investor funds to acquire, improve and operate specific apartment complexes. The investments purportedly carried interest rates of between 8 and 30 percent per year.
Contrary to these representations, prosecutors allege that Morawski and Constant, through Michael Franks, engaged in a scheme to defraud investors my misrepresenting the nature of the investments and the use of investor funds. Furthermore, the prosecutors allege that the defendants operated a Ponzi scheme by continually using funds raised from new investors to pay earlier investors. The defendants are also believed to have used investor money to pay employees, to make commission payments to other individuals, and to make payments for personal expenses such as country club memberships.
Eccleston Law represents individual and institutional investors to recover their investment losses caused by securities and investment fraud. Our attorneys also help victims of Ponzi schemes pursue recovery by submitting claims with receiverships established by the SEC or by assisting victims with the filing of a Theft Loss Tax Deduction with the IRS.
If you have lost money investing with Michael Franks, LLC, Michael Morawski, or Frank Constant you may be eligible for an immediate theft loss tax deduction. Under a new IRS safe harbor rule, you may be eligible for an immediate theft loss tax deduction of 95% of your losses, or 75% of your losses if you pursue third-party recovery. Please contact the Eccleston Law Offices at 312-332-0000 for more details.
FinancialCounsel.com, hosted by James J. Eccleston, is a companion website to this blog, along with EcclestonLaw.com. It contains complementary material of general interest to investors and financial services professionals. Investors will find material on securities arbitration to recover investment losses; industry and financial markets intelligence; and strategies for estate planning. Professionals have access to material on broker/adviser registration, regulation, compliance and disciplinary proceedings; industry and financial markets intelligence; strategies for estate planning; and broker/adviser employment litigation and injunctions, including defamation and non-competition/solicitation issues. 
Comments