The founder and CEO of financial firm Drive Planning scammed more than 2,000 investors as part of a real estate Ponzi scheme that raised more than $336 million, $67 million of which came from retirement accounts, according to the Securities and Exchange Commission.
The SEC on Aug. 14 announced that it had obtained a preliminary injunction, asset freeze and other emergency relief against Atlanta-based Drive Planning and its founder and CEO, Russell Todd Burkhalter.
The SEC’s complaint alleges that from 2020 through at least June 2024, Drive Planning and Burkhalter raised more than $336 million for purported real estate investments, telling investors their money would be used to fund land development projects, according to an SEC news release.
The defendants promised 10% interest every three months and encouraged investors to tap into their savings, retirement accounts and even open lines of credit to invest, the SEC said. However, the defendants did not have a business capable of generating the promised returns, and they instead used investor funds to make Ponzi-like payments, according to the complaint.
The SEC also found that Burkhalter stole investor funds to buy a $3.1 million yacht and spent $4.6 million on chartering private jets and luxury car services, and $2 million on a luxury condo.
The SEC charged Drive Planning and Burkhalter with violating the anti-fraud provisions of federal securities laws. The SEC is also seeking permanent injunctions, disgorgement of ill-gotten gains with prejudgment interest, and civil penalties against the defendants.
“Drive Planning and Burkhalter gained the trust of everyday people and encouraged them to invest in this scheme by promising exorbitant returns, but as our complaint alleges, the defendants’ business was nothing more than a classic Ponzi scheme, using new investor money to pay returns to existing investors, with Burkhalter stealing millions to fund a lavish lifestyle,” said Nekia Hackworth Jones, director of the SEC’s Atlanta regional office, in a statement.
Burkhalter did not immediately respond to a request for comment.
