Margaret Sanders and her firm Sanders Family Office, LLC acted as unregistered brokers while recruiting sales agents for Wells Real Estate Investment LLC, which the SEC says operated a Ponzi scheme that raised at least $56 million from approximately 660 investors. The SEC entered an administrative order on July 2, 2026, finding that Sanders and her firm violated federal securities laws while collecting commissions from the illicit capital raises.
The SEC administrative order and what it found
The Securities and Exchange Commission issued Release No. 34-105842 on July 2, 2026, in File No. 3-22655. The order states that Sanders Family Office recruited and managed a network of sales agents who solicited investments in Wells Real Estate Investment LLC. The SEC determined that Sanders and her firm acted as unregistered brokers in connection with these offerings.
The Wells Real Estate Investment LLC scheme raised at least $56 million from roughly 660 investors across multiple states. The SEC found that investor funds were commingled and used to pay earlier investors rather than for legitimate real estate projects. This classic Ponzi structure collapsed when new investor inflows slowed and withdrawal requests mounted.
Sanders Family Office received transaction-based compensation for recruiting investors, which triggered broker-dealer registration requirements under Section 15(a) of the Securities Exchange Act of 1934. Neither Sanders nor her firm was registered with the SEC or FINRA at the time of the solicitations.
Key facts about the enforcement action
| Defendant | Margaret Sanders; Sanders Family Office, LLC |
| SEC Release | No. 34-105842 (July 2, 2026) |
| File Number | 3-22655 |
| Amount Raised | $56 million |
| Number of Investors | Approximately 660 |
| Primary Violation | Acting as unregistered brokers |
| Scheme Type | Ponzi scheme through Wells Real Estate Investment LLC |
Red flags investors should have noticed
Investors were promised consistent returns from real estate investments that appeared too steady for the actual property market. The offering materials lacked audited financial statements and failed to disclose the commingling of funds. Sales agents were paid commissions based on funds raised rather than project performance.
The SEC noted that Sanders Family Office failed to register as a broker-dealer despite receiving transaction-based compensation. Federal law requires anyone engaged in the business of effecting securities transactions to register with the SEC and become a member of FINRA. The absence of registration should have triggered immediate scrutiny from potential investors.
Promised returns were not tied to identifiable real estate assets or rental income. The structure relied on continuous new capital to make payments to earlier participants. This dependency on new money is the defining characteristic of a Ponzi scheme.
What affected investors can do now
Investors who contributed funds to Wells Real Estate Investment LLC through Sanders Family Office may have claims for recovery. The SEC administrative order does not automatically return money to victims. Recovery typically requires private arbitration or civil litigation against responsible parties and their insurers.
Investors should gather account statements, offering memoranda, and correspondence with Sanders Family Office representatives. These documents establish the relationship, the representations made, and the amounts invested. Early documentation strengthens recovery prospects.
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 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.
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