NEW YORK, Dec. 10, 2015 /PRNewswire/ -- Pomerantz LLP is investigating claims on behalf of investors of United Development Funding IV ("UDF IV" or the "Company") (NASDAQ: UDF). Such investors are advised to contact Robert S. Willoughby at email@example.com or 888-476-6529, ext. 9980.
The investigation concerns whether UDF IV and certain of its officers and/or directors have violated Sections 10(b) and 20(a) of the Securities Exchange Act of 1934.
On December 10, 2015, the investor website Harvest (hvst.com) published a report asserting that the United Development Funding umbrella, which operates publicly listed and public non-traded REITs, "exhibits characteristics emblematic of a Ponzi scheme," as each successive UDF entity—e.g., UDF I, UDF II, UDF III—was used to raise funds to bail out "prior vintages" of UDF, which "continually needed a source of liquidity." The report further stated, in part, that: (i) "[v]isits to actual development sites, which serve as collateral to UDF development loans, show that, in numerous instances, there is no development and the collateral is still non-income producing, raw land 2, 3, 5 (as much as 10) years after loans were issued"; (ii) a lawsuit was filed in Texas state court in October 2015, naming UDF IV as a co-defendant in a case involving allegations of fraud, breach of contract, tortious interference and fraudulent transfer; and (iii) in November 2015, several UDF entities disclosed that their independent registered public accounting firm, Whitley Penn LLP, declined to stand for reappointment as auditor.
On this news, UDF IV stock fell $6.05, or 35.17%, to close at $11.15 on December 10, 2015.
The Pomerantz Firm, with offices in New York, Chicago, Los Angeles, and Florida, is acknowledged as one of the premier firms in the areas of corporate, securities, and antitrust class litigation. Founded by the late Abraham L. Pomerantz, known as the dean of the class action bar, the Pomerantz Firm pioneered the field of securities class actions. Today, more than 70 years later, the Pomerantz Firm continues in the tradition he established, fighting for the rights of the victims of securities fraud, breaches of fiduciary duty, and corporate misconduct. The Firm has recovered numerous multimillion-dollar damages awards on behalf of class members. See www.pomerantzlaw.com.
Robert S. Willoughby
SOURCE Pomerantz LLP