Elm Tree Receivership
On January 16, 2015, Judge William P. Dimitrouleas of the United States District Court for the Southern District of Florida entered an Order appointing Grisel Alonso, Esq., Director of Receivership and Fiduciary Services of Michael Moecker & Associates, as Receiver for Elm Tree Investment Advisors, LLC, Elm Tree Investment Fund LP, Elm Tree ‘E’Conomy Fund LP, and Elm Tree Motion Opportunity LP (“the Receivership Entities”). Judge Dimitrouleas also entered a Temporary Restraining Order freezing the assets of Frederic Elm f/k/a Frederic Elmaleh, Amanda Elm f/k/a Amanda Elmaleh and the Receivership Entities. Copies of the Court’s Orders can be viewed by clicking on “Court Filings” above.
The Receiver discovered, after reviewing investor claims and other continuing due diligence, that Etopia, LP was opened through Defendant Elm’s father, in an attempt to divert assets from the Receivership Entities, and to continue the fraudulent scheme while avoiding detection by the SEC. On February 8, 2017, the Receiver filed her Motion to Expand Scope of Receivership. On February 10, 2017, the Court entered an Order expanding the Receivership Estate to include Etopia, LP. Copies of the Motion and Order can be found under “Court Filings” above.
Since her appointment as Receiver, Ms. Alonso and her engaged professionals have been working diligently to marshal, recover, and preserve the assets of the Receivership Entities. In the course of performing her duties, the Receiver has identified individuals and entities that are in possession of Receivership assets. The Receiver through her attorneys has made demand for turnover of Receivership assets. To date, the Receiver has recovered in excess of $3.8 million. The Receiver is pleased to announce that she has liquidated real estate, furnishings, luxury cars and jewelry totaling $777,232.57.
On June 22, 2015, the Court entered an Order approving the turnover of the residence of Frederic and Amanda Elm to the Receiver. The Receiver took immediate possession and control of the Elm Home. The Receiver promptly conducted an inspection and inventory of the contents of the Elm Home and entered into a listing agreement with a reputable and experienced realtor to market the property for immediate sale. After conducting extensive market research, with the assistance of her real estate broker, the Receiver began aggressively marketing the Elm Home to prospective purchasers. On August 27, 2015, the Receiver entered into a contract to sell the Elm Home for $1,763,000.00 subject to Court approval. On September 11, 2015, the Receiver filed a Motion to Approve Sale of Real Property (Elm Home) and on September 15, 2015 the Court entered an Order granting the Receiver’s Motion. On September 28, 2015, the Receiver placed the Elm Home back on the market for sale following the buyer’s termination of the contract. On December 1, 2015, the Receiver entered into a second contract to sell the Elm Home for $1,640,000.00. On December 7, 2015, the Receiver filed her Motion seeking the Court’s approval of the proposed sale of the Elm Home and on December 8, 2015, the Court entered an Order granting the Receiver’s Motion. The sale of the Elm Home closed on December 31, 2015. The sale increases the value of the Receivership Estate by $506,543.41. Copies of the Motions and Orders can be found under “Court Filings” above.
Cars and Jewelry:
The Receiver discovered that funds from the Receivership Entities were used to purchase luxury cars and jewelry. On October 2, 2015, the Receiver filed an Agreed Motion for Turnover and Sale of Vehicles and Personal Property. In this Motion, the Receiver seeks the turnover and sale of a limited edition Bentley Continental GT, a Maserati Gran Turismo and various items of fine jewelry. On October 6, 2015, the Court granted the Receiver’s Motion. Copies of the Motion and Order can be found under “Court Filings” above.
The Receiver hired an experienced auctioneer to market and sell at public auction the cars and jewelry formerly owned by the Elms. On November 23, 2015, an auction was held which generated over $225,000.00 for the benefit of the Receivership Estate.
Efforts to recover additional funds for the benefit of defrauded investors continue. The Receiver and her retained counsel in the U.S. as well as Canada are pursuing recipients of funds (“claw-back targets”) from the Receivership Entities. The Receiver has engaged in negotiated settlement activities which has yielded over $500,000.00 in recovery for the Receivership Estate. The Receiver through her attorneys has sent demand letters and claims to numerous claw-back targets. Several of these claims have been settled with recoveries. The Receiver has filed lawsuits (Alonso v. Aerofund and Alonso v. Benvenuto et al) against twenty eight individuals and entities in the United States and Canada, seeking a return of funds for the Receivership Estate. Copies of the Complaints can be found under “Court Filings” above. The Receiver obtained judgments totaling over $3 million. The Receiver continues to collect payments owed pursuant to settlement agreements and to pursue collection of the outstanding judgments in the U.S. and Canada.
Initiation of Claims Process:
On March 31, 2016, the Court approved the claims procedures proposed by the Receiver. Copies of the Motion and Order can be found under “Court Filings” above. Investors may now submit claims to the Receiver for evaluation. Proof of claim (Poc) and Investor Release Forms can be found under “Claims” above. Fully executed Poc and Investor Release Forms must be received at the office of the Receiver no later than 5:00 pm EDT on Tuesday, June 28, 2016. For further details see Receiver’s Notice dated April 12, 2016 under “Claims” above.
Etopia LP Claims Process:
On April 16, 2018 the claims process was expanded to consider claims relating to investments in Etopia LP. Copies of the Motion and Order can be found under “Court Filings” above. Any investor wishing to submit a claim related to losses in Etopia LP must file with the Receiver no later than 5:00 pm EDT on June 15, 2018. For further details see Receiver’s Notice dated April 17, 2018 under “Claims” above.
Claim Objection Procedures:
On February 4, 2019, the Receiver proposed certain procedures to efficiently deal with claim determinations, methodology and objections. The Court entered an Order approving the Receiver’s proposed objection schedule. Copies of the Motion and Order can be found under “Court Filings” above. The Court held a hearing on May 9, 2019 to consider the Receiver’s recommendations concerning claims and objections filed claimants to Receiver’s proposed distribution method. On May 14, 2019, the Court entered an Order approving the Receiver’s recommendations as to the approval of claims and the rejection of claims and overruled the Receiver’s recommended proposed method of distribution of funds—the net investment method. The Court ruled that the rising tide method is the most equitable method in this case. The net investment method uses a pro rata distribution tied to the ratio of each investor’s net losses to their total investment. In contrast, the rising tide method factors withdrawals made by the investor in an attempt to equalize distributions to the investors. Under the rising tide method, investors who received part of their investment back during the course of the scheme do not participate in distributions until other investors, who recovered none or little of their investments, are brought up to a commensurate recovery level. The Court directed the Receiver to file a revised proposed distribution chart which applies the rising tide method to re-calculate the payout amounts to the approved claimants. The Receiver filed a revised distribution chart on May 28, 2019 and an amended revised distribution chart on June 6, 2019. The deadline to file objections to the revised chart is July 15, 2019 and the Court will hold a hearing on objections on August 2, 2019. Copies of the Motion, Orders and Receiver’s proposed distribution charts can be found under “Court Filings” above.
Receiver’s Updates and Reports:
The Receiver will update this website on a regular basis to keep investors informed of the progress of the SEC action and the Receivership. The Receiver created this website with information to the best of her ability and is not liable for any errors, omissions, etc.
We greatly appreciate your continued support and patience during the course of the Receivership. We encourage any person with information that may assist the Receiver in performing her duties in this case to contact us at ElmTreeInfo@moecker.com.