On June 23, the Securities and Exchange Commission filed suit in San Antonio against Sanders Family Office and its sole owner, Margaret Sanders. The core allegation: they sold investments they had no license to sell.
According to the complaint, from August 2020 to March 2023 the firm pitched about 600 investors on promissory notes from a company called Wells Real Estate Investment. The story sold to investors, the filing says, was a simple one - the money would buy and fix up income-producing property in South Florida, backed by real estate.
The problem, the SEC alleges, is that the firm and its owner weren't registered as broker-dealers and weren't tied to one. The complaint says they "were not permitted to sell Wells's securities." They sold them anyway, the filing alleges, raising most of the money Wells brought in.
They were paid well for it, according to the complaint. The filing says the defendants took "at least $2,977,099.53 in transaction-based sales commission payments." That kind of per-sale pay, flowing to someone the SEC says held no broker license, is a classic regulator red flag.
Then there's the retirement money. The complaint alleges the firm set up a pipeline to roll investors' 401(k) and other retirement funds into self-directed IRAs, so that cash could buy the notes. The owner and her agents walked people through it, the filing says.
So what were people buying? The complaint describes Wells - not the Sanders defendants - as "a fraudulent scheme through and through." It alleges Wells made "Ponzi-like payments with new investor funds to pay older investors," hid that its properties were already heavily mortgaged, and funneled money to its CEO and her husband for personal use. Wells raised at least $56 million from about 660 investors before collapsing in August 2024, according to the filing.
The Sanders defendants are not accused of running Wells. The SEC casts the firm as the sales operation - recruiting, training, and supervising the agents who moved the notes. The filing says the owner ran regular Zoom meetings, talked up property values, and answered questions about interest payments, which the complaint says ran 10% to 12% a year on some notes.
The SEC brings two claims: selling unregistered securities and acting as an unregistered broker. It seeks injunctions, the commissions paid back, and civil penalties.
The takeaway for advisors is hard to miss. A "family office" label buys nothing with regulators. Solicit investors, talk up a product's merits, and collect per-deal pay, and the SEC may treat you as a broker - registered or not.
The allegations have not been tested in court. The defendants have not yet filed a response, and no court has ruled.
Chicago-based Mesirow Fiduciary Solutions adds flexPATH's plan-level outsourced fiduciary book, boosting its retirement market reach to $164 billion.
Also, Raymond James's employee advisor channel adds breakaways from Wells Fargo and Stifel, while UBS welcomes an ex-Morgan Stanley duo in Indiana.
It promised guaranteed principal and 10% monthly returns. The SEC says it invested nothing.
Ten years after entering the fee-based annuity market, MassMutual Ascend says nearly half its lifetime sales came in the past two years alone – but barriers remain among fee-only advisors.
Amplify, WealthReach, Zeplyn and Zocks have unveiled partnerships aimed at automating portfolio management, content creation, account opening, and client communication.
Northern Trust’s Ken Lassner shows advisors how to convert volatility into after-tax portfolio gains
Dan Biagini of American Equity says the steady decline of pensions, longer lifespans and a reset in interest rates are rewriting how advisors build retirement income
