The U.S. Securities and Exchange Commission is calling a truce in its civil case against disgraced developer Rishi Kapoor.
In a motion filed by SEC lawyers in Miami federal court on Wednesday, Kapoor, the ex-founder of defunct Coral Gables-based Location Ventures, is settling the pending lawsuit without admitting or denying the allegations against him. The proposed judgment, which has to be approved by U.S. District Judge Jacqueline Becerra, would grant the SEC’s request for a permanent injunction against Kapoor.
In late December of last year, the SEC sued Kapoor, Location Ventures and several affiliates for allegedly violating federal securities laws. The complaint alleged Kapoor defrauded more than 50 investors who put $93 million into real estate projects by Location Ventures and its affiliates that ended up failing. The commission also alleged that Kapoor misappropriated $4.3 million in investor funds for himself.
In a statement, his lawyer, Fred Schwartz, said Kapoor “looks forward to closing this chapter of his life.”
“We are pleased to have reached a settlement in this case between Mr. Kapoor and the SEC regarding liability,” Schwartz said. “We had a professional and productive relationship with the SEC counsel and are grateful to the Commission for approving the settlement.”
An SEC spokesperson did not respond to a request for comment. It’s not clear how the settlement may affect ongoing criminal investigations into Kapoor and Location Ventures by the FBI, IRS and U.S. Attorney’s Office. Spokespersons for those agencies also did not respond to requests for comment.
According to the SEC’s motion, Kapoor would be barred for life from disseminating false and misleading documents and materials to any prospective investor about securities and investment strategy, or the prospects of success for a project or company. Kapoor would also be prohibited from sharing false information about the use of company funds, including the misappropriation of investor monies. In addition, Kapoor would be banned from serving as an officer or director of a company with securities for a five-year period, the motion states.
Court records show Kapoor signed a consent to the proposed judgment on July 11.
All of Kapoor’s and Location Ventures’ assets were frozen at the SEC’s request when the lawsuit was filed. Receiver Bernice Lee also took over management of the company and its affiliates. Over the past 11 months., Lee has quickly moved to sell off Location Ventures’ assets, including the company’s former headquarters in Coral Gables and several development sites.
Recently, Lee filed a motion seeking court permission to sell an unfinished Coconut Grove mixed-use project for $28.2 million to Miami-based developer Andrew Korge.
Kapoor stepped down from Location Ventures in the summer of 2023 following a cascade of lawsuits against him and his companies by jilted investors, vendors and a former Location Ventures executive, Greg Brooks.
In a lawsuit that was quickly settled last year, Brooks alleged Kapoor received more than $3 million in unauthorized fees, used corporate funds to buy a McLaren sports car, and secretly paid Miami Mayor Francis Suarez a $10,000 a month for an unknown private consulting gig.