DO NOT INVEST with SCOTT CARSON (We Close Notes) or Inverse Asset

Gerry Cohen · 2019-08-06T19:35:09-07:00

I have been reluctant to broadcast this information to the note investment community, hoping not to "hang out my dirty laundry" with colleagues or the note investment community. However, it is time to speak out and address this reckless and unethical behavior of SCOTT CARSON! It must be STOPPED! After attending SCOTT CARSON's (We Close Notes) seminars, Master Mind programs, and listening to his podcasts, I decided to invest as a passive investor (joint venture partner) with SCOTT CARSON (Inverse Asset Fund) to acquire a number of defaulted real estate notes. SCOTT CARSON and (Inverse Asset Fund) acting as the lead investment manager to secure the notes and properly disposition. Not so dissimilar from most note joint ventures agreements. Once funds transferred the joint venture immediately transformed into a bad movie! SCOTT CARSON never followed up, never shared information on the status of the investment (notes) nor paid out interest income per the agreement. After more than 24 months, following the terms of the agreement I gave SCOTT CARSON (Inverse Asset Fund) the appropriate notice to dissolve the joint venture, return principal and interest owed to me. I am still waiting for proper disposition and return of principal. Naively, I thought SCOTT CARSON (Inverse Asset Fund) would do the "right thing" and meet his obligation if treated like a professional. No such luck! After several attempts to address this obligation directly through legal counsel, I instructed my attorney to secure a judgment against SCOTT CARSON and Inverse Asset Fund, If you take the time to research Travis County, Texas county records you should see my approved judgement as well as other judgments awarded to other passive investors. This is not how the "note investment business" works! In closing DO NOT INVEST with SCOTT CARSON (We Close Notes) and Inverse Asset Fund.

Jay HinrichsBusiness Member

Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes

7y

Originally posted by @Chris Seveney:

I share the sentiments of many on here. I am sorry this has happened to so many as I was a student of Scott's and had promoted his training in the past. Like @Gene Chandler and others who I am close with in the note industry, Scott and Steph were good to us. The common theme was we took training but did not invest. Many of us made the mistake of promoting his business without doing our proper due diligence. As @Adam Adams mentioned, we are taught to trust our teachers.

For me what I find most disheartening about this whole situation is several of these judgments are recent and during this time he was posting pictures on Instagram of his multi-week European vacation including flying first class, taking multiple cruises etc.

Seems to be a theme Morris and his wife spent a month in Italy last year while the kingdom was burning down.

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Bob Malecki

Investor · Kingston, WA · Member since 2008 · 1k+ posts · 1k+ votes

7y

Yeah, who knows, maybe he'll get featured on an upcoming episode of American Greed.

Originally posted by @Chris Seveney:

I share the sentiments of many on here. I am sorry this has happened to so many as I was a student of Scott's and had promoted his training in the past. Like @Gene Chandler and others who I am close with in the note industry, Scott and Steph were good to us. The common theme was we took training but did not invest. Many of us made the mistake of promoting his business without doing our proper due diligence. As @Adam Adams mentioned, we are taught to trust our teachers.

For me what I find most disheartening about this whole situation is several of these judgments are recent and during this time he was posting pictures on Instagram of his multi-week European vacation including flying first class, taking multiple cruises etc.

3 Reply

Martin Saenz

Investor · Fredericksburg, VA · Member since 2017 · 377 posts · 230 votes

7y

Originally posted by @Bob Malecki:

Yeah, who knows, maybe he'll get featured on an upcoming episode of American Greed.

Originally posted by @Chris Seveney:

I share the sentiments of many on here. I am sorry this has happened to so many as I was a student of Scott's and had promoted his training in the past. Like @Gene Chandler and others who I am close with in the note industry, Scott and Steph were good to us. The common theme was we took training but did not invest. Many of us made the mistake of promoting his business without doing our proper due diligence. As @Adam Adams mentioned, we are taught to trust our teachers.

For me what I find most disheartening about this whole situation is several of these judgments are recent and during this time he was posting pictures on Instagram of his multi-week European vacation including flying first class, taking multiple cruises etc.

I believe he is speaking at the Quest IRA this month. I'm not going but some folks mentioned he is a featured speaking there. Not quite American Greed

0 Reply

Jay HinrichsBusiness Member

Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes

7y

Originally posted by @Martin Saenz:

Originally posted by @Bob Malecki:

Yeah, who knows, maybe he'll get featured on an upcoming episode of American Greed.

Originally posted by @Chris Seveney:

I share the sentiments of many on here. I am sorry this has happened to so many as I was a student of Scott's and had promoted his training in the past. Like @Gene Chandler and others who I am close with in the note industry, Scott and Steph were good to us. The common theme was we took training but did not invest. Many of us made the mistake of promoting his business without doing our proper due diligence. As @Adam Adams mentioned, we are taught to trust our teachers.

For me what I find most disheartening about this whole situation is several of these judgments are recent and during this time he was posting pictures on Instagram of his multi-week European vacation including flying first class, taking multiple cruises etc.

I believe he is speaking at the Quest IRA this month. I'm not going but some folks mentioned he is a featured speaking there. Not quite American Greed

Target rich environment for him IRA money

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Christopher Winkler

Specialist · Dallas, TX · Member since 2014 · 900 posts · 392 votes

7y

Not at all Jay, these are when notes are purchased and not worked on or touched, or nothing was every purchased. This is fraud and criminal.

After seeing him at a REIA, during his cross country REIA tours to find victims, I went through his bootcamp. He gave Veterans like me a free pass, and it does cover a lot of ground to new people looking to enter the business. Then I joined his advanced training, which was decent to help market & promote myself, went to 2 masterminds which for note buying is a joke.

One time the notes we worked on never materialized, the other so many were there, over 80; we drew straws and I was one of the last and did not get what I wanted, I got garbage. Luckily my and my JV partners money was in an IRA and he refused to provide a PSA or AOM for them, since he did not own them, so they never funded it. He just wanted me to send money, with nothing in writing, which luckily I was not able to do. I have heard many have done that which is now pooling money and a possible securities violation.

It was only a buy, not a JV. The people who JV with him did not have the time or will to work them out, so they trusted their guru. When losses hits 6 figures to multiple people its time to end this.

I request Bigger Pockets to remove his account, as you are allowing him a platform to promote this fraudulent activity to find new victims and that is not right.

8 Reply

Jay HinrichsBusiness Member

Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes

7y

Originally posted by @Christopher Winkler:

Not at all Jay, these are when notes are purchased and not worked on or touched, or nothing was every purchased. This is fraud and criminal.

After seeing him at a REIA, during his cross country REIA tours to find victims, I went through his bootcamp. He gave Veterans like me a free pass, and it does cover a lot of ground to new people looking to enter the business. Then I joined his advanced training, which was decent to help market & promote myself, went to 2 masterminds which for note buying is a joke.

One time the notes we worked on never materialized, the other so many were there, over 80; we drew straws and I was one of the last and did not get what I wanted, I got garbage. Luckily my and my JV partners money was in an IRA and he refused to provide a PSA or AOM for them, since he did not own them, so they never funded it. He just wanted me to send money, with nothing in writing, which luckily I was not able to do. I have heard many have done that which is now pooling money and a possible securities violation.

It was only a buy, not a JV. The people who JV with him did not have the time or will to work them out, so they trusted their guru. When losses hits 6 figures to multiple people its time to end this.

I request Bigger Pockets to remove his account, as you are allowing him a platform to promote this fraudulent activity to find new victims and that is not right.

So people sent money and never got notes and never got a refund ?? well that's not good.

and or they bought the note on the proviso that he would or his team would work the note to try to get it back in compliance and they did nothing ? I would think those that bought the notes in that scenario could just take their note and do their own thing then.. ??

but the taking money and not receiving the note well that's just theft.. seems to me that should be criminal as well. if those allegations are in fact true..

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Dennis Weber

Real Estate Investor · Indianapolis, IN · Member since 2014 · 316 posts · 165 votes

7y

Clayton Morris just moved to Portugal

Originally posted by @Jay Hinrichs:

Originally posted by @Chris Seveney:

I share the sentiments of many on here. I am sorry this has happened to so many as I was a student of Scott's and had promoted his training in the past. Like @Gene Chandler and others who I am close with in the note industry, Scott and Steph were good to us. The common theme was we took training but did not invest. Many of us made the mistake of promoting his business without doing our proper due diligence. As @Adam Adams mentioned, we are taught to trust our teachers.

For me what I find most disheartening about this whole situation is several of these judgments are recent and during this time he was posting pictures on Instagram of his multi-week European vacation including flying first class, taking multiple cruises etc.

Seems to be a theme Morris and his wife spent a month in Italy last year while the kingdom was burning down.

1 Reply

Jay HinrichsBusiness Member

Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes

7y

Originally posted by @Christopher Winkler:

Not at all Jay, these are when notes are purchased and not worked on or touched, or nothing was every purchased. This is fraud and criminal.

After seeing him at a REIA, during his cross country REIA tours to find victims, I went through his bootcamp. He gave Veterans like me a free pass, and it does cover a lot of ground to new people looking to enter the business. Then I joined his advanced training, which was decent to help market & promote myself, went to 2 masterminds which for note buying is a joke.

One time the notes we worked on never materialized, the other so many were there, over 80; we drew straws and I was one of the last and did not get what I wanted, I got garbage. Luckily my and my JV partners money was in an IRA and he refused to provide a PSA or AOM for them, since he did not own them, so they never funded it. He just wanted me to send money, with nothing in writing, which luckily I was not able to do. I have heard many have done that which is now pooling money and a possible securities violation.

It was only a buy, not a JV. The people who JV with him did not have the time or will to work them out, so they trusted their guru. When losses hits 6 figures to multiple people its time to end this.

I request Bigger Pockets to remove his account, as you are allowing him a platform to promote this fraudulent activity to find new victims and that is not right.

Also Chris that is why any note transaction I am doing we get fresh lender policy for the note buyer. and handle all funds through national title company.

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4 Reply

Yael Maroko

Investor · Atlanta GA · Member since 2019 · 35 posts · 20 votes

7y

@Jay Hinrichs Can you please explain what is a "lender policy" for a note buyer? How is this done? Seems like a good precaution to take as a note investor.

Thanks

1 Reply

Chris SeveneyBusiness Member

Moderator

Investor · VA · Member since 2015 · 21k+ posts · 19k+ votes

7y

@Yael Maroko - lender policy is a title policy that protects the lender From a title defect. Based on the comments being made in this post, the issues being discussed have nothing to do with title and would not protect an investor.

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Beth Hale

Specialist · Denver, CO · Member since 2017 · 14 posts · 50 votes

7y

Originally posted by @Adam Adams:

I've seen a lot of comments in regards to risky investments, bad management, incompetence and such. I think you need to go back to Gerry's and Al's comments. Once you give money to Scott, the communication stops. No updates on the investment. No distributions. Nothing. Even legal action doesn't get anything out of him once he has your money. The only time he'll get back with you is when he thinks you are going to hurt his business, as in the case of this post. Most of the posts in the past have been taken down because he pays off his investor. Testor v Carson was the first one I saw. Testor put up a website that a few people saw. Scott saw it, paid him off and it was down shortly after. Other posts have been in his basecamp forum. Very short-lived posts because the OP gets paid off. Anyone notice that he's suddenly got a ton of CFDs for sale. He he's raising money from Peter to pay off Paul to get this post down. The guy takes your money and runs away with it to Disney Euro. Same goes for the guy I invested with that is his buddy that used to be an attorney. Every month I'm on the phone with someone out there that calls me wanting to know what I know about these two. Every time I go to a conference, more people are wanting to know more about what I know. Why me? Heck if I know. Maybe because I did a ton of videos for him. Whatever the reason, I do get a lot of calls. And since this post started, I've got 7 people calling and writing to me wanting to know what I know. And it's not just Scott that's a crook from that group.

And while this comment might hurt a lot of people including myself, everyone needs to have some suspicion with all of Scott's associates and former associates. I know I do. These are not incompetent investment managers. These are crooks who con you into showing you the ropes of the business using their positions as mentors and "successful" note players. Then they want you to buy their crappy notes or JV with them on their crappy deals. Success is just around the corner if you just let them show you how, and pay them. @Michele Orgel named a few, but unfortunately, she didn't name them all. I'd name them, but my wife will kick my *** if I do.

Adam,

Thanks for getting the subject of this thread back to where it started. I was concerned when it trailed off into "You can always lose money with your investments ...."

This post is about "I invested money with him, and then I didn't get any updates about what was happening. The year went by and then I requested my money back as per the JV agreement. I got some of it back (or not in some cases). Then he went dark on me."

Again, I think it's pretty captain obvious that we can all lose money on our investments. But one doesn't expect the one who is MANAGING the money to:

a) not return our calls or texts

b) not return our emails

c) fail to provide you with "accounting" on all of the assets with a basecamp account, as the JV agreement said

d) not make quarterly payments from the assets that reperform

e) not appear to be "working out" the assets at all

f) fail to return the principle and 12% interest after the year is up and the assets haven't sold

g) JV with ANOTHER party on the same asset(s) he JV'd with you on (which happened to me).

This is not just "losing money" while investing. The is gross mishandling of funds on the part of "guru" taking your money.

Now, I don't expect anybody to be squeaky clean on every point, but when he doesn't return calls and emails on top of it all, what's an investor to think.

9 Reply

Christopher Winkler

Specialist · Dallas, TX · Member since 2014 · 900 posts · 392 votes

7y

The next step would be filing complaints with the Texas Attorney General, your state Attorney General, FBI, IRS & SEC...

1 Reply

Kimberly Banks Fawcett

Investor · Orange County, CA · Member since 2014 · 19 posts · 44 votes

7y

Not really sure what I can add to this post regarding his legal troubles except to say that overall, the assets are not the problem. The lack of communication, while awful, also is not the problem. It's the management of the assets and OPM.

However, I do want to encourage all to follow @Adam Adams's advice. You should be doing background checks on everyone but when dealing with someone who has worked closely with Scott and continues to do so, check more thoroughly. You hear rumors all the time but you just don't want to believe them. They are heartbreaking because he can be so generous and thoughtful and a hell of a lot of fun. And he really has the potential to light the world on fire (legally). But at some point, there are too many stories to ignore and you are faced with a decision. Try and help him fix the mess (trust me: he won't let you, I tried countless times), ignore it/do nothing or move on. Do you want to give your money to those who choose B or C?

If anyone you are thinking of investing with tells you that they didn't know, that shouldn't be comforting. That means their due diligence skills aren't very strong.

Also, thank you to @Martin Saenz for your kind words about we ex-Scott students. Please judge our abilities and our integrity individually. Sure, some remain oblivious -- do with them what you will. But others of us are trying to do our best. It is pretty devastating when you realize someone you really trusted is a fraud.

7 Reply

Bob Malecki

Investor · Kingston, WA · Member since 2008 · 1k+ posts · 1k+ votes

7y

@Kimberly Banks Fawcett many of the featured guests on American Greed appear generous and friendly while they execute their agenda of deceit. Be careful about publicly stating you tried to help Scott, you could be exposed to complicit behavior should the TX GA or SEC get involved.

2 Reply

Jay HinrichsBusiness Member

Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes

7y

Originally posted by @Bob Malecki:

@Kimberly Banks Fawcett many of the featured guests on American Greed appear generous and friendly while they execute their agenda of deceit. Be careful about publicly stating you tried to help Scott, you could be exposed to complicit behavior should the TX GA or SEC get involved.

its the hall mark of a good con artist.. wont get far being a con man if your mean not nice and a jerk :)

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Kimberly Banks Fawcett

Investor · Orange County, CA · Member since 2014 · 19 posts · 44 votes

7y

Originally posted by @Jay Hinrichs:

Same with mass murders. Everyone thought Ted Bundy was a doll.

2 Reply

Adam Adams

Investor · Small Town, TX · Member since 2016 · 110 posts · 252 votes

7y

@Christopher Winkler Here is the rub with going to the authorities. The authorities don't make Scott pay anyone back. They seize all the assets and assign a trustee. After years and years go by, you might get some nickels back. What really sucks is you can't even write off the loss because it's not lost. It's with a trustee in a state of limbo. I speak from experience on this. One of the complaints from the Feds in the lawsuit I am involved in is that the culprit was living luxuriously beyond the means of his earning. I see Scott doing that every day. So the only people that are going to say anything to the authorities are those that have given up on getting their money back, or those that were fortunate to get their money back already.

In the end, I do expect the authorities to come in and seize everything. He doesn't own anything but hides the assets with Stephanie. It's a lame trick that the authorities don't care about. Stephanie will lose everything too. Bankruptcy won't protect fraud either. I wouldn't be surprised to see jail time when it is all said and done.

3 Reply

Jay HinrichsBusiness Member

Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes

7y

Originally posted by @Adam Adams:

@Christopher Winkler Here is the rub with going to the authorities. The authorities don't make Scott pay anyone back. They seize all the assets and assign a trustee. After years and years go by, you might get some nickels back. What really sucks is you can't even write off the loss because it's not lost. It's with a trustee in a state of limbo. I speak from experience on this. One of the complaints from the Feds in the lawsuit I am involved in is that the culprit was living luxuriously beyond the means of his earning. I see Scott doing that every day. So the only people that are going to say anything to the authorities are those that have given up on getting their money back, or those that were fortunate to get their money back already.

In the end, I do expect the authorities to come in and seize everything. He doesn't own anything but hides the assets with Stephanie. It's a lame trick that the authorities don't care about. Stephanie will lose everything too. Bankruptcy won't protect fraud either. I wouldn't be surprised to see jail time when it is all said and done.

this is always the issue with these things.. if this person truly has no assets or whatever assets are with Stephanie ( assuming the wife) and your hoping to get paid back then the operator ends up defrauding more people to try to pay back the original ones and it becomes a big Ponzi also in those cases like Madoff there is crawl back.. people that forced a payoff early can be asked to give the money to the trustee to be shared equally MILLIONS were clawed back in the Madoff case.

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Adam Adams

Investor · Small Town, TX · Member since 2016 · 110 posts · 252 votes

7y

@Jay Hinrichs Didn't know that. That would suck.

1 Reply

Rahul Bhatt

Fremont, CA · Member since 2015 · 289 posts · 63 votes

7y

I know at least three people including my self Got burned by Scott Carson I will send email to the fellow investor Garry

1 Reply

Martin Saenz

Investor · Fredericksburg, VA · Member since 2017 · 377 posts · 230 votes

7y

Originally posted by @Kimberly Banks Fawcett:

Not really sure what I can add to this post regarding his legal troubles except to say that overall, the assets are not the problem. The lack of communication, while awful, also is not the problem. It's the management of the assets and OPM.

However, I do want to encourage all to follow @Adam Adams's advice. You should be doing background checks on everyone but when dealing with someone who has worked closely with Scott and continues to do so, check more thoroughly. You hear rumors all the time but you just don't want to believe them. They are heartbreaking because he can be so generous and thoughtful and a hell of a lot of fun. And he really has the potential to light the world on fire (legally). But at some point, there are too many stories to ignore and you are faced with a decision. Try and help him fix the mess (trust me: he won't let you, I tried countless times), ignore it/do nothing or move on. Do you want to give your money to those who choose B or C?

If anyone you are thinking of investing with tells you that they didn't know, that shouldn't be comforting. That means their due diligence skills aren't very strong.

Also, thank you to @Martin Saenz for your kind words about we ex-Scott students. Please judge our abilities and our integrity individually. Sure, some remain oblivious -- do with them what you will. But others of us are trying to do our best. It is pretty devastating when you realize someone you really trusted is a fraud.

Thank you...I think this Scott Carson episode has been healing for some and great awareness for others. You can't hide with social media now! It's not that I per-judged folks that were in his circle or thought I was better than someone, I'm just a cautious investor that didn't have time to give the benefits of the doubt as I knew something was off with his program. I wasn't sure if it was a group effort or just him or what. Plus, it's a completely different side of the industry as I mainly buy junior liens. I really like that you're a thought leader and really connect with your message when I hear you speak. I had Scott leave my FB group several years ago because I saw some things then and just wanted to create space between myself and his program (not knowing it was at this level of foul play).

0 Reply

Bob Davidson

San Francisco, CA · Member since 2018 · 4 posts · 5 votes

7y

Having been a corporate fraud investigator for many years, I say from considerable experience that your chance of getting much, if any, money back is almost nonexistent. Even if a criminal trial orders restitution, the statistics are that less than 1% (one percent) ever receive money. And never the full amount. Fraudsters know that your only hope is to incur expensive legal fees that will drain you of more money but have a very low chance of success; and therefore you won't want to incur throwing good money after bad to go after them. The desire for revenge and to get the money back is strong. I got that. But that's why the four large corporations I worked for never filed a civil suit or turned over for prosecution any fraud. Just too much executive (your) time and money for no return. It's painful to say, but move on and lesson learned. Sorry, but crime pays and it pays very well.

1 Reply

Jim Workman

Investor · La Crescenta, CA · Member since 2013 · 174 posts · 50 votes

7y

There has been a lot of talk about doing background checks. Can someone suggest a few reputable background checking companies? My research only finds 'tenant background checks'. Who can you use for 'business partner background checks'?

1 Reply

Christopher Winkler

Specialist · Dallas, TX · Member since 2014 · 900 posts · 392 votes

7y

Originally posted by @Jim Workman:

There has been a lot of talk about doing background checks. Can someone suggest a few reputable background checking companies? My research only finds 'tenant background checks'. Who can you use for 'business partner background checks'?

Jim, you and everyone else please start a new thread on that or other subjects, as a prior victim said, its getting sideways and off topic, and we need to just focus on the the topic. Thank you.

1 Reply

Bob E.

Queen Creek, AZ · Member since 2014 · 2k+ posts · 1k+ votes

7y

I got comped on a three day seminary's back in 2014 that Scott held in Phoenix. During the class he had a "star student" that he held up as an example. One of the attendees looked up the student and found that he was a disbarred attorney. That was enough to set off my warning sensor. I wish I could remember that students name, would love to by them dinner, they probably saved me a lot fo money.

1 Reply

DO NOT INVEST with SCOTT CARSON (We Close Notes) or Inverse Asset

DO NOT INVEST with SCOTT CARSON (We Close Notes) or Inverse Asset

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