The SEC today announced that it obtained a preliminary injunction, asset freeze and other emergency relief against Drive Planning LLC and its founder and CEO, former Atlanta-based advisor Russell Todd Burkhalter, to halt a $300 million nationwide real estate Ponzi scheme impacting more than 2,000 investors.
The defendants misappropriated millions of dollars of investor funds to fund Burkhalter’s exorbitant lifestyle and to make Ponzi-like payments to customers, according to the complaint, filed Tuesday in the US District Court for the Northern District of Georgia.
The SEC further alleges that Burkhalter stole investor funds to pay for personal luxuries, including the purchase of a $2 millon luxury condo, a $3.1 million yacht and $4.6 million on chartering private jets and luxury car services.
Burkhalter spent 2008 to 2014 as a registered investment advisor at advisor firms in the Atlanta suburbs without a customer or firm complaint, according to Finra's BrokerCheck database.
From 2020 through at least June 2024, Burkhalter and his firm “duped more than 2,000 investors into buying unregistered securities known as ‘Real Estate Acceleration Loans’ (REAL) that promised 10% returns within three months,” according to the SEC’s lawsuit.
The lawsuit alleges that Drive Planning and Burkhalter raised more than $300 million for purported real estate investments, telling investors their money would be used to fund land development projects.
“The defendants promised 10% interest every three months and encouraged investors to tap their savings, retirement accounts and even open lines of credit to invest,” the SEC said in the suit.
As of early May 2024, the scheme was receiving applications for over a million dollars every day, driven by an organization of more than 100 sales agents, the SEC said.
In reality, “the defendants did not have a business capable of generating the promised returns, and they instead used investor funds to make Ponzi-like payments,” according to the complaint.
Drive Planning’s website champions itself as a firm that can “Bring proven tax strategies and private investments from the wealthy to your life.” A call placed to the firm’s corporate office was not returned.
In addition to the emergency relief granted by the court, which the SEC said the defendants did not oppose, the SEC seeks permanent injunctions, disgorgement of ill-gotten gains with prejudgment interest, and civil penalties against the defendants, and an officer-and-director bar against Burkhalter.
The complaint also names Burkhalter’s spouse Jacqueline Burkhalter, and several related entities, as relief defendants and seeks disgorgement of ill-gotten gains from them as well.