DBSI, Inc. was an Idaho-based real estate investment company that has been insolvent since 2007. The founder and former President of DBSI and other top executives were indicted in April, 2013 on 83 counts, including “conspiracy to commit securities fraud, wire fraud, mail fraud, and interstate transportation of stolen property.” Much of DBSI’s business was based on tenant-in-common (TIC) investments, which included nearly $1 billion in investor contributions between 2003 and 2008. In 2007, DBSI was losing $3 million per month on its real estate properties. These losses increased to $8 million in 2008. After years of gross misrepresentation of DBSI as a profitable company, investors received warnings on their investments only six weeks before the company filed for bankruptcy in 2008. In spring of 2014 four top executives of DBSI, including the president, were found guilty of fraud. In light of DBSI’s significant history of mismanagement and problematic practices, intermediary broker-dealers had the responsibility to perform due diligence that was potentially ignored if they proceeded to sell DBSI investments.
We have ongoing investigations into sales of DBSI investments, because readily evident issues exist with the categorization and representation of their holdings, including their sizeable collection of TIC properties. DBSI guaranteed unrealistic returns and sold properties to investors at inflated prices. Basic issues which apply to many claims involving DBSI investments include:
Moving Forward with Your Claim
If you suffered losses from a DBSI investment, contact us for a free consultation. You may be able to recover your losses, and we advise you to seek professional legal counsel if you are interested in pursuing arbitration.