Investor Alert: MCG Madison Waterstar Investors, LLC – Madison Capital Group Reg D Offering

The White Law Group is investigating potential securities claims involving investments in MCG Madison Waterstar Investors, LLC, a Regulation D private placement sponsored by Madison Capital Group, based on a Form D filing with the SEC.

About Madison Capital Group

Madison Capital Group, headquartered in Charlotte, NC, and Charleston, SC, is a private equity real estate investment firm. It operates two main divisions:

• Go Store It Partners, a sponsor of self-storage investments.
• Madison Communities, a developer and operator of garden-style multifamily communities throughout the Southeastern United States.

The firm has issued numerous real estate-focused Reg D offerings, including MCG Madison Waterstar Investors, LLC, which launched in 2020 and raised nearly $2 million as of its Form D filing. The offering was structured under Rule 506(b) of Regulation D and sold through Arkadios Capital.

Concerns with Reg D Private Placement Investments

Regulation D offerings are exempt from SEC registration, meaning they carry higher risk and offer less investor protection than publicly traded investments. Common investor issues include:

• High commissions and fees – In this case, estimated sales commissions reached 12% of gross proceeds.
• Illiquidity – These investments are not traded on public markets, making resale nearly impossible.
• Lack of transparency – Limited financial reporting and oversight can make it difficult to monitor investment performance.
• Sponsor conflicts – The sponsor reportedly received $300,000 in offering proceeds as a fee for providing a guarantee, a potential red flag for investors.

Broker Responsibilities & Potential Misconduct

FINRA-registered broker-dealers are required to vet private placements thoroughly and ensure investments are suitable for each client. If your broker failed to disclose the risks, or pushed the investment despite your conservative goals or financial circumstances, you may be able to pursue a claim.

Brokers should review:

• The sponsor’s track record and financial health
• The project’s development risks and exit strategy
• Whether the offering aligns with the investor’s age, liquidity needs, and goals

FINRA Arbitration vs. Class Action Lawsuits

While class action suits may be an option in certain scenarios, most investor disputes related to private placements like this one are resolved through FINRA arbitration. This process can be quicker and more favorable for individual investors seeking to recover losses tied to unsuitably recommended investments or broker misconduct.

Contact The White Law Group for a Free Review : MCG Madison Waterstar Investors

If you invested in MCG Madison Waterstar Investors, LLC or another Madison Capital Group Reg D offering and are concerned about your losses, you may be entitled to recovery through FINRA arbitration.

To speak with a securities fraud attorney at The White Law Group, please call 888-637-5510 or visit www.whitesecuritieslaw.com.

Frequently Asked Questions – MCG Madison Waterstar Investors

What is MCG Madison Waterstar Investors, LLC?
It is a private placement investment in residential real estate sponsored by Madison Capital Group, structured under Regulation D for accredited investors.

How do I know if I qualify for a FINRA arbitration claim?
If your broker failed to conduct adequate due diligence or misrepresented the risks of the investment, you may be eligible to file a claim.

Is there a secondary market for this investment?
No. Reg D offerings like this are illiquid and generally cannot be sold before maturity or project completion.