Jerry Ellenburg

You should contact your state securities division immediately if you encounter any of these situations with your investment:

• Default on promised payments or return of principal

• Misrepresentation of material facts about the investment

• Failure to honor personal guarantees

• Undisclosed risks or conflicts of interest

• Suspected unauthorized sale of securities

• Unregistered investment offerings

• Failure to provide required investment documentation

• Sales by unlicensed individuals or entities

• Significant deviations from stated business plans

• Inability to obtain accurate information about your investment

It's especially important to contact your state securities division when:

1. Regular payments have stopped or become irregular

2. Communication with investment managers has broken down

3. You discover information that wasn't disclosed during the investment process

4. Your investment terms have been unilaterally changed

5. You suspect fraudulent activity

6. The business is not operating as represented

Don't wait to contact your state securities division if you suspect problems. Early reporting can help protect both your interests and those of other investors. Securities divisions have the authority to investigate complaints, enforce securities laws, and potentially help recover investor funds.

Remember: While you may be pursuing other remedies (such as direct negotiation or legal action), filing with your state securities division creates an official record of your complaint and may trigger regulatory investigation of the matter.

What types of complaints do they handle?

State securities divisions handle a wide range of investment-related complaints and securities violations. Their jurisdiction covers fraudulent investment schemes, misrepresentation in securities offerings, unregistered securities sales, unauthorized trading, broker misconduct, and investment advisor fraud. They investigate complaints about defaulted investment payments, breached personal guarantees, undisclosed investment risks, and material misrepresentations in investment offerings. The divisions also handle cases involving Ponzi schemes, real estate investment fraud, bridge loan defaults, unauthorized securities offerings, and unlicensed securities dealers. Common complaints include failure to return principal investments, stopped interest payments, misrepresented business operations, and undisclosed conflicts of interest. If you've experienced investment losses due to false statements, concealed risks, or deceptive practices, your state securities division has the authority to investigate and potentially take enforcement action. 

How long does the complaint process take?

The timeline for state securities division complaints varies significantly depending on the complexity of your case, the state's current caseload, and the nature of the alleged violations. Initial acknowledgment of your complaint typically occurs within 1-2 weeks, but full investigations can take several months to multiple years to complete. Complex cases involving multiple investors, extensive documentation, or cross-state investigations generally take longer. While the process may seem lengthy, it's crucial to file your complaint as soon as possible – early reporting can help protect other investors and may improve chances of recovery. Securities divisions prioritize cases based on several factors, including the number of investors affected, the amount of money involved, and the potential ongoing risk to the public. During the investigation, you may be asked to provide additional documentation or clarification, and you should respond promptly to these requests to help keep your case moving forward. Remember that you can pursue other remedies, such as private legal action, while your securities division complaint is being investigated. 

Can I file complaints in multiple states?

Yes, you can and often should file complaints in multiple states when your investment involves cross-state operations or multiple jurisdictions. For example, if the investment company operates in Texas but is registered in Delaware, and you live in Florida, you may file complaints in all three states. Each state's securities division can investigate violations within their jurisdiction, and multi-state complaints can lead to coordinated investigations. This is particularly relevant for investments involving multiple property locations, companies operating across state lines, or securities registered in different states. Filing in multiple jurisdictions can increase regulatory pressure and may lead to more thorough investigations. However, be sure to disclose in each complaint that you've filed with other state securities divisions to ensure transparent communication and coordinated enforcement efforts. For maximum effectiveness, start with the state where you reside, the state where the company is headquartered, and any states where the investment properties or operations are located.