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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

Receiver’s Motion for Order Allowing Redistribution of Funds

On April 6, 2020, the Receiver filed a motion with the Court requesting authority to redistribute $12,878.34 to allowed claims.  A copy of the motion is attached here.  If no objections to the motion are filed by the April 20, 2020 deadline and the Court enters an Order granting the motion, distribution checks should be mailed to Investors in May, 2020.

DCG – Motion for Authority to Make Redistribution

DCG – Notice of Motion for Authority of Redistribtuion

Memo from Special Master Regarding Change of Richard W. Davis, Jr. Release Date

DCG – Memo on Change of Davis Release Date

Final Distribution Checks

On January 7, 2020, the Receiver mailed checks for final distributions to the holders of allowed claims in the DCG Receivership case.  Please promptly deposit your check upon receipt.  Claimants should notify the Receiver if they have not received a check by January 31, 2020.

Receiver’s Final Application for Attorney’ s Fees and Accountant’s Fees

A.  Cotten Wright, Receiver, has filed a final application for compensation for the period of October 1, 2019 through December 3, 2019 to Grier Wright Martinez, PA. The application for  compensation seeks approval of $3,245.50 in fees and reimbursement of expenses of $0.00, for a total of $3,245.50.

The Receiver has also filed an application for compensation to Middleswarth, Bowers and Company, LLC, accountants for the Receiver.  That application seeks approval of $2,911.0 0in fees and reimbursement of $40.00 in expenses, for a total of $2,951.00.  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 within 14 days, 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.

DCG – Bowers Final Fee Application 4846-4941-7902 v.1

DCG – GWM Final Application for Compensation 4822-9530-4622 v.2

DCG Notice of Fee Apps for GWM and Bowers 4812-6725-0082 v.1

Order on Final Distributions

On Friday, December 6, 2019, the Court entered the Order Granting Receiver’s Motion for Authority to Make Proposed Final Distributions.  As a result, final distribution checks will be mailed on January 7, 2020.  We look forward to closing the Receivership case in the New Year.

Order Final Distributions 12-6-19

Receiver’s Motion for Order Authorizing Proposed Final Distributions

On November 15, 2019, the Receiver filed a motion with the Court requesting authority for a final distribution of $787,000.00 to allowed claims.  A copy of that motion is posted here.  The proposed distribution works out to 8.75% total recovery for Claimants.  If no objections to the motion are filed by the December 2, 2019 deadline and the Court enters an Order granting the motion, distribution checks should be mailed to Investors in December, 2019.

Motion on Proposed Final Distributions & Exhibit

Notice of Motion on Final Distributions

Receiver’s Thirteenth Application for Attorney’ s Fees and Eleventh Application for Accountant’s Fees

A.  Cotten Wright, Receiver, has filed an application for compensation for the period of July 1, 2019 through September 30, 2019 to Grier Wright Martinez, PA. The application for  compensation seeks approval of $4,309.00 in fees and reimbursement of expenses of $3.50, for a total of $4,312.50.

The Receiver has also filed an application for compensation for the period of July 1, 2019 through September 30, 2019 to Middleswarth, Bowers and Company, LLC, accountants for the Receiver.  That application seeks approval of $318.75 in fees and reimbursement of $37.00 in expenses, for a total of $355.75.  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 within 14 days, 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.

DCG- Notice of Fee Apps for GWM and Bowers

DCG- Bowers 11th Application for Compensation

DCG- GWM 13th Application for Compensation