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Government Action
The following describes a pending government action that has been formally brought by a government agency but has not yet been resolved. We are providing a summary of the government's allegations, which have not yet been proven.
October 30, 2018 The following describes a Desist and Refrain Order that has been formally brought by a government agency. Jan Lynn Owen of the Department of Business Oversight (Commissioner of Business Oversight), alleges and charges as follows:
Beginning in or about at least September 2016, and continuing thereafter, Zak Investments, Pacific West, Polanco, and Nevarez, offered or sold securities in the form of investment contracts, to the public, including at least two California residents, raising at least $75,000.00.
Polanco and Nevarez told investors that their money would be used to purchase shortsale properties in "cash-for-keys" real estate transactions, which Polanco and Nevarez stated they would later "flip for a large profit." Polanco and Nevarez told investors that they could withdraw their investment at any time and would receive their principal investment back in the form of a cashier's check. The purported purpose of the offering was to raise funds for further investment in Pacific West Home's real estate investment program. Polanco directed investors to make their checks payable to Nevarez's company, 3 Spot Marketing.
A "cash-for-key" transaction is a transaction in which a lender advances money to a borrower undergoing foreclosure, such as a tenant's security deposit or moving expenses, as an incentive to facilitate the borrower's early move out and return of the keys to the foreclosed property to the lender so as to avoid formal legal eviction proceedings.
When Polanco and Nevarez's reported to investors that their attempts to purchase distressed properties were unsuccessful, the investors requested a return of their investment. Nevarez told investors that their money had been given to the homeowners with whom they negotiated so the homeowners could vacate the homes. To date, investors have not received the "large profits" Polanco and Nevarez promised.
These securities were offered or sold in this state in issuer transactions. The Department of Business Oversight has not issued a permit or other form of qualification authorizing any person to offer or sell these securities in this state.
To access the full Department of Business Oversight press release, please visit:
http://www.dbo.ca.gov/ENF/pdf/2018/Zak-Investments,Inc-10-30.pdf
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