Beware of Norada Capital: Caveat Emptor My Fellow Small Investors !!!

[David Kanarek]

In 2023, I invested in some Norada Capital Management 7 year Promissory Notes and last week less than one year after signing the last note, I receive a "form" email addressed to "Valued Investor", dated June 20th, 2024 from Marco Santarelli, who signed the letter as CEO & founder, that interest payments were being suspended until further notice without any resumption date. In 2023 before I invested any funds, each and every time that I spoke with their representatives, I asked as my FIRST question if Norada Capital Management had ever missed any interest or principal payments, and was always told the same thing by their representatives, that Norada Capital Management had a perfect payment/reimbursement history.

One week later, after writing their current investors that they are suspending interest payments, they are still seeking new investors for investments but do not inform the new potential investors that they have suspended interest payments. (see attachment)

Before you invest, please feel free to contact me and I will be happy to furnish all of the documentation of this episode, but in the meantime don't trust anything that is not in writing and don't sign any document that allows them to stop paying the interest and/or principal that is owed for any reason.

As I am currently preparing a report for the BBB, the CFPB and the FCC, I would also ask if anyone else has had a similar experience; I feel like David vs. Goliath so please let's work together to see what can be done to have them resume interest payments. And, like me, please leave all the reviews you can on all the web sites you can find about your experience so that other small investors have this information about Marco Santarelli and Norada Capital Management. Thank you.

[Jay Hinrichs]

Quote from @Don Konipol:

I went back and reread the OPs posts.  He became progressively unhinged as time progressed, especially when anyone made a comment he didn’t like or agree with, even if the comment was of a general nature.  He resorted to personal attacks on the integrity of other posters as well as a seemingly paranoia concerning posters being somehow associated with the subject company.  Of course he offered no basis for his accusations.  
His posts on this thread were his only posts on BP.  While none of this provides any evidence one way or the other about the legality- legitimacy of the offering or company in question, it does say something about the state of mind of at least one person who invested in this offering. 
The fact that a company has stoped paying interest on a promissory note and is exercising an option stated in the note to convert the note to equity is not in and of itself indicative of any fraud.  Of more concern to me would be the ridiculous investment strategy; the qualification of the sponsors to evaluate these brand investments; whether proper and full disclosure was provided; and the fees and other compensation the sponsor received on invested capital. 

  Don,   Another Pearl !!  

[Dennis Summerford]

Quote from @David Kanarek:

In 2023, I invested in some Norada Capital Management 7 year Promissory Notes and last week less than one year after signing the last note, I receive a "form" email addressed to "Valued Investor", dated June 20th, 2024 from Marco Santarelli, who signed the letter as CEO & founder, that interest payments were being suspended until further notice without any resumption date. In 2023 before I invested any funds, each and every time that I spoke with their representatives, I asked as my FIRST question if Norada Capital Management had ever missed any interest or principal payments, and was always told the same thing by their representatives, that Norada Capital Management had a perfect payment/reimbursement history.

One week later, after writing their current investors that they are suspending interest payments, they are still seeking new investors for investments but do not inform the new potential investors that they have suspended interest payments. (see attachment)

Before you invest, please feel free to contact me and I will be happy to furnish all of the documentation of this episode, but in the meantime don't trust anything that is not in writing and don't sign any document that allows them to stop paying the interest and/or principal that is owed for any reason.

As I am currently preparing a report for the BBB, the CFPB and the FCC, I would also ask if anyone else has had a similar experience; I feel like David vs. Goliath so please let's work together to see what can be done to have them resume interest payments. And, like me, please leave all the reviews you can on all the web sites you can find about your experience so that other small investors have this information about Marco Santarelli and Norada Capital Management. Thank you.

 There is a private Facebook group, the lawsuits have started, there are criminal complaints being filed, Marco and Alex are crooks

[David Kanarek]

As usual you are completely 100% wrong, and you know who disagrees with you?

The SEC, Homeland Security who are investigating, 3 lawsuits with many more to come and by the way, you know who also disagrees with you? Everyone with half a brain.

Note to anyone thinking about working with this imbecile. Check his legal history. You will find some fascinating information about his previous dealings. My advice. Do not work with people who defend criminals especially when they do NOT have the facts on their side. And are just ignorant, uninformed talking heads. Check the facts with someone who is not a criminal sympathezier !! Ask where they went to law school to pontificate as if they had a clue of what they were talking about.

And above all, and most importantly stay clear of fraud defenders; it is only a matter of time this creep defends other's suspicious activity (including his own?) and that we will all be writing blogs about him.  

[Don Konipol]

Quote from @David Kanarek:

As usual you are completely 100% wrong, and you know who disagrees with you?

The SEC, Homeland Security who are investigating, 3 lawsuits with many more to come and by the way, you know who also disagrees with you? Everyone with half a brain.

Note to anyone thinking about working with this imbecile. Check his legal history. You will find some fascinating information about his previous dealings. My advice. Do not work with people who defend criminals especially when they do NOT have the facts on their side. And are just ignorant, uninformed talking heads. Check the facts with someone who is not a criminal sympathezier !! Ask where they went to law school to pontificate as if they had a clue of what they were talking about.

And above all, and most importantly stay clear of fraud defenders; it is only a matter of time this creep defends other's suspicious activity (including his own?) and that we will all be writing blogs about him.  

Reminds mean of the old Paul Simon song “Still Crazy After All These Years” 

[Domingo Perez]

David,

Love to be included as I too was sold of Marco’s word that they have never missed a payment. 
count me in, let me know how I can help.

[Chris Seveney]

Quote from @Domingo Perez:

David,

Love to be included as I too was sold of Marco’s word that they have never missed a payment. 
count me in, let me know how I can help.

 What ever happened to the lawsuits that were filed? I thought someone said either here on BP or Reddit that his assets would be frozen by end of this month? Assuming that is not the case

[Don Konipol]

Quote from @Chris Seveney:

Quote from @Domingo Perez:

David,

Love to be included as I too was sold of Marco’s word that they have never missed a payment. 
count me in, let me know how I can help.

 What ever happened to the lawsuits that were filed? I thought someone said either here on BP or Reddit that his assets would be frozen by end of this month? Assuming that is not the case

I would think that many of the posters are not very experienced with litigation, either civil or criminal.  They “optimistically believe contacting an attorney is the same as engaging an attorney; that engaging an attorney is the same as sending a demand letter; that sending a demand letter is the same as filing a lawsuit; that filing a lawsuit is the same as obtaining an injunction; and that obtaining an injunction is the same as winning a case; and that winning a case is the same as perfecting a judgement; and that perfecting a judgement is the same as collecting on the judgement.  

So, to play “devils advocate” here’s a possible scenario.  Potential plaintiffs have an initial meeting with attorney.  During the meeting attorney suggests they have a “great” case, and they should move forward by filing an immediate injunction to “freeze” assets.  The attorney quotes he can do this for an initial $1500. 
After the potential plaintiffs leave his office, the attorney does further research.  Finds (1) half of what plaintiffs told him is incorrect or untrue; the potential defendant has filed all the correct paperwork for Reg D and hence has “statutory” protection against almost all but fraud; unlike what the plaintiffs believe and told the attorney the risks WERE disclosed to them, NO specific return was promised them; and the defendants have not stopped communications; they merely grew tired of the 82 daily phone calls asking, accusing, and raging by the same three plaintiffs.  Meanwhile in a state of temporary euphoria (insanity?) the potential plaintiffs are trying to recruit all investors (probably at the suggestion of the attorney who’d like to of course get as large a settlement as possible) and “projecting” a little as to the state of their lawsuit on social media.  
So, their attorney gets back to them with the new that (1) their dream of a “contingency” fee lawsuit is a non starter (2) that the process is going to be long, drawn out, and (3) that a $15,000 retainer would be required. 
The original posters / plaintiffs now go silent on social media but the secondary investors still believe the original posts and simply repeat it continually in an effort to convince themselves that the money they should have never invested because they couldn’t afford to lose is going to be recovered in short order.

Of course this is just fantasy on my part, I have no way of knowing how much of it, if any is true.  But I have seen just this scenario played out MANY times before.  

You could tell by the “vile” reaction of the OP when I mentioned that he provided no proof of fraud how “unhinged” he is.  To summarize, what I have seen is a possibly poorly conceived investment possibly sold to people who are not sophisticated.  I’ve been shown no evidence that there was fraud, nor that the sale of the investment opportunity was not in compliance with either the General Exemption for Private Placement or Reg D safe harbor. 

[Jay Hinrichs]

Quote from @Don Konipol:

Quote from @Chris Seveney:

Quote from @Domingo Perez:

David,

Love to be included as I too was sold of Marco’s word that they have never missed a payment. 
count me in, let me know how I can help.

 What ever happened to the lawsuits that were filed? I thought someone said either here on BP or Reddit that his assets would be frozen by end of this month? Assuming that is not the case

I would think that many of the posters are not very experienced with litigation, either civil or criminal.  They “optimistically believe contacting an attorney is the same as engaging an attorney; that engaging an attorney is the same as sending a demand letter; that sending a demand letter is the same as filing a lawsuit; that filing a lawsuit is the same as obtaining an injunction; and that obtaining an injunction is the same as winning a case; and that winning a case is the same as perfecting a judgement; and that perfecting a judgement is the same as collecting on the judgement.  

So, to play “devils advocate” here’s a possible scenario.  Potential plaintiffs have an initial meeting with attorney.  During the meeting attorney suggests they have a “great” case, and they should move forward by filing an immediate injunction to “freeze” assets.  The attorney quotes he can do this for an initial $1500. 
After the potential plaintiffs leave his office, the attorney does further research.  Finds (1) half of what plaintiffs told him is incorrect or untrue; the potential defendant has filed all the correct paperwork for Reg D and hence has “statutory” protection against almost all but fraud; unlike what the plaintiffs believe and told the attorney the risks WERE disclosed to them, NO specific return was promised them; and the defendants have not stopped communications; they merely grew tired of the 82 daily phone calls asking, accusing, and raging by the same three plaintiffs.  Meanwhile in a state of temporary euphoria (insanity?) the potential plaintiffs are trying to recruit all investors (probably at the suggestion of the attorney who’d like to of course get as large a settlement as possible) and “projecting” a little as to the state of their lawsuit on social media.  
So, their attorney gets back to them with the new that (1) their dream of a “contingency” fee lawsuit is a non starter (2) that the process is going to be long, drawn out, and (3) that a $15,000 retainer would be required. 
The original posters / plaintiffs now go silent on social media but the secondary investors still believe the original posts and simply repeat it continually in an effort to convince themselves that the money they should have never invested because they couldn’t afford to lose is going to be recovered in short order.

Of course this is just fantasy on my part, I have no way of knowing how much of it, if any is true.  But I have seen just this scenario played out MANY times before.  

You could tell by the “vile” reaction of the OP when I mentioned that he provided no proof of fraud how “unhinged” he is.  To summarize, what I have seen is a possibly poorly conceived investment possibly sold to people who are not sophisticated.  I’ve been shown no evidence that there was fraud, nor that the sale of the investment opportunity was not in compliance with either the General Exemption for Private Placement or Reg D safe harbor. 

Ya you cant make a leap like these folks have done when the payments are missed and they are allowed to be moved to equity..  My dads RE attorney taught me many things in my formative years in the business.. But one thing was you don't go from hey we got a problem straight to suing you try to work these out no one wins in the law suit game or rarely.  Bruno ( my dads attorney ) had a little statue on his back credenza it was an old judge with the tag line
Sue the Bastard LOL.. However Don what you lay out is exactly how these things usually play out at least up front.. This type of transaction will take years to go through the legal system most likely and if the sponsor is put out of business recovery will be non existent.

I would think the only way Feds come in and lock this down if they can prove that the investments noted in the offering were never made and that the sponsor just pocket the cash and used new cash to pay the old investors.  However if money was transferred to these companies investments and they went bad.. Well its just like in our business when we make a loan and the borrower stops paying we deal with it..

[Henry Clark]

@David Kanarek

If I'm wrong on the underlying investment types, please adjust and respond.

Understand the underlying investments are Crypto trading, Broadway shows, and defunct Brands.  Could you explain to me the investment strategy that was to be used behind each Asset type?

Crypto trading- example:  invest and hold for 5 years,  use a $10mm highspeed server and do fractional trading per minute?, etc.

Broadway shows- what are some of the names?  Were they Movie based or original plays?

Defunct Brands- what are some of the names?  What was the plan to revamp, how much runway in terms of time and dollars? Who was the Marketing Guru to steer the ship?  etc.

Thanks.

What was the underlying finance terms behind the project, not your investment?

Thanks.  I have asked several times on this post and another similar one, for people to note their due diligence checklist, but no one has responded.  Would like to understand from you the investors standpoint what part of the due diligence that failed.

Another item of discussion has everyone gotten over the concept of Passive investing?  We develop/Buy Self Storage locations.  Lots of work up front.  Afterwards pretty Passive, plus we are in control.

[David DiGioia]

Count me in...I invested last year as well. Just a few weeks before they suspended payment, he had a seminar I was watching, touting how well they were doing. He sent me a balance sheet showing $157M in net assets. Please keep me posted Thank you!

[Chris Seveney]

Quote from @David DiGioia:

Count me in...I invested last year as well. Just a few weeks before they suspended payment, he had a seminar I was watching, touting how well they were doing. He sent me a balance sheet showing $157M in net assets. Please keep me posted Thank you!

While that may not come in handy recovering monies from him, it could come in handy in a criminal case as I am sure people would want to understand how they justified that balance sheet. 

[Laura Rajavuori]

Quote from @David Kanarek:

Whether or not it is legal is something a court will decide. You left out the deception that they claimed they NEVER miss interest/principal payments. And you also left what you think of them continuing to seek new investors without mentioning the possibility of suspension of previous investors interest payments.

Unlike Norada and Marco Santorelli, I am giving fellow honest investors the facts so they can make a decision as to how to proceed with all the correct information. Whether or not Norada gets away with this legally,  I am doing my duty to warn people, not what I falsely declare or believe what could happen, but the facts, but what has ACTUALLY already happened. I will certainly continue to spend as much time and resources necessary to make sure as many people know as possible. 

 I agree with you David. It appears that you did your due diligence to understand the risk involved and you inquired of Marco Santerelli a full honest disclosure of Norada records so you could assess that risk before handing over your investment. Carry on with your investigation and any litigation as a judge just may agree with you. Hopefully you have e-mails that they stated their “honest” appraisal of their past. Judges will consider ethics especially where potential fraud may be brewing. As for where Marco claims to be investing, look this up as I found that he is bordering on an illegal form of reinvesting money so you may be able to sling that stone to kill this “giant”. I sure am sorry that this has happened to you. Thanks for warning others and keep us posted on your findings and fight.