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DALLAS, Jan. 25, 2022 (GLOBE NEWSWIRE) — NexPoint Advisors, LP, investment advisor to NexPoint Diversified Real Estate Trust and other traded and non-traded funds (collectively, “NexPoint”), today provided an update on the United Development Fund IV (“UDFI” or “Company”) following the January 21, 2022 conviction of four UDFI officers of fraud by a federal jury. A jury found the four officers guilty of all ten counts of the indictment, including securities fraud, conspiracy to commit securities fraud, and conspiracy to commit wire fraud affecting a financial institution.
This belief reiterates NexPoint’s ongoing concerns about the lack of transparency and accountability in UDFIs. Since November 2015, the company has failed to provide shareholders with any reliable and material financial information. NexPoint is UDFI’s largest shareholder and has been working hard to drive the company’s long-term value on behalf of all investors. Accordingly, NexPoint has made several attempts to increase transparency by meeting with management to inquire about UDFI’s financial position and strategy, and by requiring the company to provide shareholders with basic financial information; however, the company has firmly refused to provide NexPoint and all other UDFI shareholders with any material information about the company. information. In addition, despite legal and bylaw requirements for UDFI to provide financial statements and other material information to shareholders, UDFI’s board of directors did not take any corrective action, leading NexPoint to seek relief through the courts.
NexPoint has filed a lawsuit asking the company to provide shareholders with access to its books and records and is seeking to appoint a receiver. The Jan. 21 convictions of key UDFI leaders and their outside advisers on financial fraud charges have added to the need for such oversight.
Criminal case background
The case was announced on October 15, 2021, through an indictment filed in federal court. (A copy of the indictment can be found here.) According to the indictment, four company executives participated in a scheme to use multiple investments to defraud investors and mislead their lenders…
The full story is available on Benzinga.com
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