The Securities and Exchange Commission has charged Tampa-based RAD Diversified REIT Inc. and its founders Brandon “Dutch” Mendenhall and Amy Vaughn with orchestrating a $152 million fraud scheme that attracted more than 5,500 investors nationwide. The complaint, filed in the U.S. District Court for the Middle District of Florida, alleges the pair misrepresented the REIT’s profitability, diverted $54 million in investor funds for personal use, and employed high-pressure sales tactics that invoked Christian values and patriotism.
What happened
RAD Diversified REIT was founded in 2017 by Mendenhall. The company marketed itself as a real estate investment vehicle that purchased distressed residential properties, renovated them, and leased or sold them for profit. Investors were told they would receive cash dividends from rental income and property sales.
Between 2019 and 2024, Mendenhall and Vaughn raised $152 million through splashy social media campaigns, in-person meetings, and a network of unregistered sales agents, according to the SEC complaint. The pair allegedly told investors that no one had ever lost money with RADD and falsely represented the company’s stock price and valuation.
Key facts
| Entity | RAD Diversified REIT Inc. |
| Founders | Brandon “Dutch” Mendenhall, Amy Vaughn |
| Location | Tampa, Florida |
| Total raised | $152 million |
| Investors affected | More than 5,500 |
| Funds diverted | $54 million to The Seminar Solution LLC |
| Personal expenses | Private jets, luxury goods, IRS payments, adult nightclubs, firearm ranges |
| Foreclosure actions | 166 actions totaling nearly $50 million |
| Redemptions frozen | February 2024 |
| High-pressure tactics | Home equity loans, retirement account withdrawals, credit cards, life insurance proceeds |
How the scheme operated
Mendenhall promoted RADD as “real estate done for you” through an extensive campaign across social media platforms, in-person seminars, and unregistered sales agents. The SEC says the founders pressured investors into taking home equity loans, dipping into retirement accounts, using life insurance proceeds, and maxing out credit cards to fund their investments.
The company promoted a $50,000 exclusive membership called the “RADD Inner Circle.” Sales agents allegedly encouraged investors to pay for this membership using credit cards. The marketing invoked Christian values and patriotism to create trust, the complaint states.
Financial collapse and concealment
The REIT’s financial condition deteriorated rapidly after 2022. When Mendenhall applied for a $15 million line of credit that year, the bank declined and noted in an email that “the company looks to be losing $20 million repeatedly and covers the cost of operational expenses which are abnormally high through equity raises in the public market.”
Between 2022 and 2024, rental income and property sales failed to cover operating expenses. The company faced mortgage defaults and at least 166 foreclosure actions totaling nearly $50 million. In February 2024, RADD froze stock redemptions, effectively trapping investor capital.
Investor impact and property conditions
The SEC complaint states that defendants’ conduct “has caused financial hardship to thousands of investors nationwide and has jeopardized many of their retirement savings.” The victims span multiple states and include retirees who were steered toward high-risk alternative investments using their nest eggs.
Meanwhile, residents of RADD-owned properties suffered neglect. A West Philadelphia rowhouse purchased by RADD in 2019 through auction saw tenants filing complaints about pests and leaky pipes that went unanswered even as rents increased, according to reporting by The Philadelphia Inquirer in 2022.
Personal enrichment alleged
Mendenhall and Vaughn told investors they did not receive salaries in 2023 and 2024 as a personal sacrifice. The SEC alleges that during this same period, they diverted more than $50 million of RADD investor funds into The Seminar Solution LLC, an entity they owned. These funds were then transferred to their personal accounts.
Mendenhall allegedly transferred at least $1.4 million from The Seminar Solution bank accounts into his personal account. He used $691,000 to pay the IRS, $75,000 for a nanny, and $197,000 in American Express charges. His personal expenses included thousands of dollars spent at adult nightclubs and firearm ranges.
Red flags investors missed
Several warning signs were visible before the SEC filing. The $50,000 “Inner Circle” membership fee was an unusual and excessive charge for a REIT investment. The pressure to use credit cards, retirement withdrawals, and home equity loans to invest is a hallmark of schemes that prioritize capital raising over legitimate returns. The promise that “no investor had ever lost money” is an unsustainable and unverifiable claim.
Unregistered sales agents handling investments without proper licensing should have triggered scrutiny. The invocation of religious and patriotic themes in sales pitches is a documented manipulation tactic used to bypass rational due diligence.
What affected investors can do now
Time matters in REIT recovery cases. The earlier you act, the stronger your position. Investors who contributed capital to RAD Diversified REIT may have claims under securities arbitration or civil litigation, depending on how they invested and what representations were made.
Haselkorn & Thibaut fights for investor recovery
Haselkorn & Thibaut is a securities law firm founded by former Wall Street defense attorneys who shifted their practice to represent investors. The firm has recovered over $520 million for clients in securities matters and maintains a 98 percent success rate in resolved nontraded REIT cases. Attorneys are AV Preeminent rated through Martindale-Hubbell, designated as Super Lawyers, and hold a 5.0-star client review average. The firm operates on a contingency basis — no recovery, no fee.
Contact Haselkorn & Thibaut today
Time matters in REIT recovery cases. The earlier you act, the stronger your position. The firm offers a free case evaluation to assess your losses, review your account history, and explain your options under arbitration or settlement.
- Main Phone: 1-888-885-7162
- website for a free consultation
Offices in Florida, New York, Arizona, Texas, and North Carolina. Former Wall Street defense attorneys with 95+ years of combined experience. No recovery, no fee.
This article is for informational purposes only and does not constitute legal advice. Investors who believe they suffered losses related to RAD Diversified REIT may wish to consult a qualified securities attorney to review their options.
