dcgreceivership Uncategorized

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On June 2, 2016, the Securities and Exchange Commission (the “SEC”) filed a complaint against Richard W. Davis, Jr. (“Davis”) and the entities named below (the “Receivership Defendants”), alleging that Davis, through the Receivership Defendants, raised at least $11.5 million through the unregistered sale of securities and failed to disclose to investors that the majority of the funds raised were either transferred to entities owned or controlled by Davis or transferred Davis in amounts in excess of the management fees that he had represented to investors he would be entitled to.  The SEC alleged various violations of the Securities Act of 1933, the Securities Exchange Act of 1934, the Investment Advisers Act of 1940, and certain rules established under those statutes.  In the complaint and a subsequent motion, the SEC requested that the Court appoint a receiver for the entities listed below to marshal the assets of the Receivership Defendants in an orderly fashion and determine whether and to what extent the funds may be repaid to investors.

Without admitting or denying any of the allegations in the SEC’s complaint, Davis consented to entry of a judgment in the Civil Action. On June 3, 2016, the Court entered judgement against Davis, which, among other things, permanently restrains and enjoins Davis from engaging in any further conduct that would violate the Securities Act of 1933, the Securities Exchange Act of 1934, or the Investment Advisers Act of 1940 and also requires Davis to disgorge funds in an amount to be determined by the Court upon a future motion by the SEC.  Davis also consented to the appointment of a receiver.

Accordingly, on June 8, 2016, the Court appointed the Receiver to take possession, custody, and control over all of the assets belonging to the Receivership Defendants or any of their subsidiaries, successors, and assigns (the “Receivership Estate”).  In addition, the Receiver has been directed to liquidate the assets of the Receivership Estate, conduct a claims determination process, and disburse the funds in the Receivership Estate to holders of allowed claims based on a distribution scheme to be approved by the Court in the future.

The Receivership Defendants include the following:

  • DCG Real Assets, LLC
  • DCG Commercial Fund I, LLC
  • H20, LLC
  • DCG PMG, LLC
  • DCG PMF, LLC
  • Finely Limited, LLC
  • DCG Funds Underwriting, LLC
  • DCG ABF Management, LLC
  • DCG Funds Management, LLC
  • Davis Capital Group, Inc.
  • Davis Financial, Inc.
  • DCG Partners, LLC
  • DCG Real Estate Development, LLC
  • Huntersville Plaza Phase One, LLC
  • Huntersville Plaza Phase Two, LLC
  • North Lake Business Park, LLC
  • Richard Davis Enterprises, LLC
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Receiver Files Amended Claims Report

dcgreceivership Pleadings

On June 19, 2018, the Receiver filed her Amended Report of Claims, Objections to Claims and Recommendations Regarding Claims (the “Amended Claims Report”), which proposes various amendments to treatment of claims submitted against the DCG Receivership estate.  A copy of the Amended Claims Report is attached here, with amendments appearing in bold, shaded text.  In order to protect the privacy of Investors, claims are identified by claim number in the Claims Report.  Any Investors who have questions or concerns about the Amended Claims Report and the Receiver’s recommendations to the Court are encouraged to contact the Receiver to discuss those issues.  It is the Receiver’s goal to resolve any disputes as to claim allowances consensually.  If, however, the Receiver is not able to reach an agreement with an Investor, the Investor may file a written response with the Court on or before July 20, 2018, in which case the Court may schedule a hearing.  Again, please feel free to reach out to the Receiver with any questions regarding the Amended Claims Report.

DCG Amended Claims Report

DCG Notice of Amended Claims Report

Notice of Sentencing Hearing Scheduled As to Richard Wyatt Davis, Jr.

dcgreceivership Uncategorized

On June 7, 2018, the United States District Court scheduled a sentencing hearing as to Richard Wyatt Davis, Jr. to take place on June 25, 2018 at 9:30 a.m. in Courtroom 2-2, United States Courthouse, 401 West Trade Street, Charlotte, North Carolina.  The Honorable Robert J. Conrad Jr. will preside.

Investors will recall that Mr. Davis accepted a Plea Agreement which was entered on January 12, 2018.

Investors who wish to attend the sentencing hearing are encouraged to contact the Receiver / Special Master, Cotten Wright, at dcgreceiver@grierlaw.com or 704-332-0207.

The results of the sentencing hearing will be posted to this webpage.

Receiver Files Claims Report

dcgreceivership Pleadings

On May 15, 2018, the Receiver filed her Receiver’s Report of Claims, Objections to Claims and Recommendations Regarding Claims (the “Claims Report”) in the DCG Receivership case.  A copy of the Claims Report is attached here.  In order to protect the privacy of Investors, claims are identified by claim number in the Claims Report.  The Receiver has sent letters to each Investor who filed a claim in the Receivership case enclosing a copy of the Claims Report and setting out the Investor’s claim number along with the Receiver’s proposed treatment of the Investor’s claim.  Any Investors who have questions or concerns about the Claims Report and the Receiver’s recommendations to the Court are encouraged to contact the Receiver to discuss those issues.  It is the Receiver’s goal to resolve any disputes as to claim allowances consensually.  If, however, the Receiver is not able to reach an agreement with an Investor, the Investor may file a written response with the Court, in which case the Court may schedule a hearing.  Again, please feel free to contact the Receiver with any questions regarding the Claims Report.

DCG Claims Report, Objections to Claims and Recommendations Regarding Claims 

DCG Notice of Claims Report and COS

Receiver’s Seventh Application for Attorneys’ Fees and Fifth Application for Accountants’ Fees

dcgreceivership Pleadings

A.  Cotten Wright, Receiver, has filed an application for compensation for the period of January 1, 2018 through March 31, 2018 to Grier Furr & Crisp, PA. The application for  compensation seeks approval of $21,570.50 in fees and reimbursement of expenses of $101.64, for a total of $21,672.14.

The Receiver has also filed an application for compensation for the period of January 1, 2018 through March 31, 2018 to Middleswarth, Bowers and Company, LLC, accountants for the Receiver.  That application seeks approval of $2,768.00 in fees and reimbursement of $1.77 in expenses, for a total of $2,769.77.  Regardless of any fees and expenses that may be allowed by the Court, payment of any approved fees and expenses shall be limited to 30% of net recoveries.

If you do not want the Court to approve the applications noticed herein, or if you want the Court to consider your views, then on or before April 25, 2018, you or your attorney must do the following: (1) file a written response explaining your position with the Court; (2) mail, fax or email a copy of your response to the Receiver; and (3) attend a hearing on your response, if the Court schedules a hearing.

If you or your attorney do not take these steps,  the Court may decide that you do not oppose the relief the Receiver requests and may enter orders approving the applications for compensation.

Attachments:

DCG GFC Seventh Application for Compensation

DCG Bowers Fifth Application for Compensation

DCG Notice of Applications for Compensation GFC and Bowers