SEC Charges Rita Mansour and McDonald Partners LLC for Misleading Investors in Montenegro Resort Offerings
The Securities and Exchange Commission (SEC) has reportedly charged Rita Mansour, a financial advisor registered with McDonald Partners LLC, with misconduct tied to allegedly fraudulent private securities offerings. The offerings purportedly raised over $14 million from U.S. investors and were intended to finance the construction of a luxury resort in Montenegro. According to the SEC, Mansour and her firm allegedly failed to disclose critical information about the misuse of investor funds.
Who is Rita Mansour?
Rita Mansour (CRD #1968418) is an investment advisor and FINRA-registered representative with McDonald Partners LLC (CRD# 135414), a broker-dealer and investment advisory firm based in Toledo, Ohio. She has reportedly been affiliated with the firm since 2007.
Mansour reportedly has six FINRA complaints filed against her since 2019, according to public records. These complaints, including allegations of misrepresentation and unsuitable investment recommendations, raise serious concerns about her history of compliance and the supervision provided by McDonald Partners.
SEC Findings: Failure to Disclose Misappropriation of Investor Funds
The SEC’s enforcement action reveals that between 2013 and 2017, McDonald Partners and Mansour reportedly offered and sold securities tied to two pooled investment vehicles (PIVs), later allegedly identified as Eden Rock Montenegro LLC and ERM Resort LLC. These offerings were purportedly marketed to both brokerage customers and advisory clients as bridge funding for the development of a five-star resort in Montenegro.
In October 2016, Mansour and the firm reportedly learned that their contact at the Montenegrin entity had misappropriated approximately $488,000 in investor funds using a company debit card. Despite reportedly negotiating a partial repayment of about $335,000, neither Mansour nor McDonald Partners disclosed the incident to investors, according to the SEC.
Even more troubling, the firm allegedly continued to raise an additional $1.5 million from new and existing investors in early 2017, without ever informing them of the misappropriation. Mansour was allegedly personally involved in recommending and selling these securities.
Rita Mansour: SEC Charges and Violations
The SEC found that Mansour’s conduct allegedly caused McDonald Partners to violate:
- Sections 17(a)(2) and 17(a)(3) of the Securities Act of 1933
- Sections 206(2) and 206(4) of the Investment Advisers Act of 1940
- Rule 206(4)-8 under the Advisers Act
These provisions are designed to protect investors from misleading and deceptive practices by those in the securities industry.
Investor Recovery Options
If you invested in Eden Rock Montenegro LLC, ERM Resort LLC, or any other offering sold by Rita Mansour or McDonald Partners LLC, you may have a viable claim for recovery through FINRA arbitration.
Brokerage firms have a duty to supervise their advisors and to ensure that investments are suitable and disclosed accurately. When they fail to do so, investors may be entitled to compensation for their losses.
Contact The White Law Group
The White Law Group is investigating potential claims involving Rita Mansour and McDonald Partners. If you have questions about your investment losses, contact our offices at 888-637-5510 for a free consultation.
To learn more about The White Law Group and our current investigations, visit www.whitesecuritieslaw.com.
Frequently Asked Questions
1. What is FINRA arbitration and how does it help investors recover losses?
FINRA arbitration is a legal process through which investors can seek to recover losses caused by broker misconduct or unsuitable investment recommendations. It is an alternative to traditional court litigation and is typically required under the terms of your brokerage account agreement. The process is generally faster and less costly than a lawsuit, and decisions made by arbitrators are binding.
2. Can I join a class action lawsuit instead of filing a FINRA arbitration claim?
Possibly, but in most cases involving investment losses, investors must pursue individual FINRA arbitration claims rather than joining a class action. This is because brokerage accounts usually include arbitration clauses that waive the right to participate in class actions. Individual claims often result in more personalized attention and potentially higher recoveries based on your unique facts.
3. How can I recover investment losses involving Rita Mansour or McDonald Partners LLC?
If you were sold unsuitable or misrepresented investments by Rita Mansour or McDonald Partners LLC, you may be eligible to file a FINRA arbitration claim to recover your losses. An experienced securities attorney can help evaluate your case, gather evidence, and represent you in the arbitration process. The White Law Group has recovered millions of dollars for investors nationwide through FINRA arbitration.
