SEC Charges Bay Area Real Estate Developer with Misleading Investors
May 5, 2021
File No. 3-20280
May 5, 2021 - The Securities and Exchange Commission today charged Maxwell Drever, a real estate developer based in the San Francisco Bay Area, with misleading investors in a multi-million dollar real estate fund that he managed.
According to the SEC's order, Drever raised approximately $53 million from investors for the stated purpose of purchasing and redeveloping a commercial building in Dallas, Texas. The order finds that Drever failed to disclose his receipt of $10.2 million in fees charged to investors in connection with the purchase and redevelopment of the building. The order also finds that while Drever invested $9 million of the undisclosed fees he received into the project, he used that money to take an equity stake in the project for himself, and falsely told certain investors that his investment came from his own funds.
The SEC's order finds that Drever violated Sections 17(a)(2) and 17(a)(3) of the Securities Act of 1933. Without admitting or denying the SEC's findings, Drever consented to a cease-and-desist order; to pay disgorgement of $1,214,246 plus prejudgment interest of $282,979 and a civil penalty in the amount of $75,000; and to publish a copy of the SEC's order on the website of his wholly-owned entity, Drever Capital Management LLC. In addition, Drever has undertaken to cancel the equity stake in the project that he received in exchange for his investment of $9 million in undisclosed fees.