I've been reading the strings from the investors and am quite frankly amazed that every investor didn't think something was fishy. We were going to invest but then asked ourselves - "isn't this too good to be true" - if the answer is yes, then it's probably illegal. The company was set up on a pyramid scam - only the top ones (first ones in) really get paid - the later you went in the later you will get paid because more "investors" have to be obtained. You never did make any profits, you only given the newest investor's money - that was why the big push to get investors. :goofy:
I'm truly sorry for your losses
Listen folks,
As an unfortunate member of the Six Figure Club, I am highly pissed at the delays being caused by the SEC involvement as well as the potential reduction in potential payout to investors as a result of fees to be paid to the Legal team etc. However, I am shocked that given as much information as has been provided by the receiver, ex-employees etc that anyone here still believes they would have been paid out just fine had the SEC not stepped in. Granted those who just got checks during the week the SEC stepped in might be an exception but common folks, please disregard some of the emotion associated with your loss, take blinders off and see this thing for what it is.
It is unrealistic to pay 150% per annum on the cost of funds and sustain a realistic business model. I've worked with private investors who lend money and they only get 12% to 18% on their money. Heck even a hard money lender for rehabbing does not get 150% per year on his money.
Consider the market Gene was investing in. I have a home north of Atlanta and I can tell you that even in the nice areas like Alpharetta, we've not been seeing 30% per annum appreciation much less 150% to sustain his business model.
It has not been determined if the properties Gene was purchasing in and around metro Atlanta were actually being sold to legitimate 3rd parties in arm lengths transactions.
The oldest game in the book as far as investing in the heart of Atlanta is to buy properties in regentrified neighborhoods at discounts and sell them at huge markups that have been inflated. There are only 101 ways to make an appraisal come out at a value that you would like. Try then selling that inflated home to an objective, non-biased 3rd party in an arms length transaction and see if that would fly. There are properties that appraise for $350,000 in certain parts of Atlanta that are in these regentrified neighborhoods that you couldn't pay me $500,000 per year to live in.
We have had a few ex-employees blew the whistle on what was really going on inside Pinnacle.
After a year plus stellar record of making payments on time, someone questions the legitimacy of Pinnacle and they conveniently "speed up" the launch of Pinnacle Consulting. To claim this is a coincidence is simply ridiculous.
Come on folks, how long does it take to compute how much your are due, figure out GA state tax at 6%, take a rubber stamp of Gene's signature to imprint on checks, FedEx/UPS/USPS said check to your address? I mean what could actually be causing them to be 3 to 4 weeks behind on "processing" these payments other than they don't have sufficient funds to process these payments? Give me a break!
As much as I would like to believe that we would have been paid out had the SEC not stepped in, that is simply a wet dream!! - It's not real.
Please guys, let's refrain from blowing off steam that the SEC is involved. Like taxum or someone else said, if Gene's business is in fact legit and he has sufficient funds, then he can certainly pay his legal fees, as well as pay off investors as the SEC finds out that they were wrong in their assumptions about Pinnacle and issues a formal apology - However, that too is a dream at this point b/cos the evidence thus far points to the fact that there was something sinister about their operations.
The best thing you can do now is pray and hope that you get as much of your principal back as possible. You may also want to read the book Failing Forward by John Maxwell. The true test of wealth is if it is in fact all stripped away from you as has been the case with this Pinnacle debacle, can you recreate it even if it means starting back out with nothing. We should learn more from our failures than from our sucesses and hopefully we will all be better as a result of this experience with Pinnacle.
I challenge everyone one to make a list of at least 7 things they are thankful for and then go a step further and identify someone who is less fortunate than you are (I know you think such a person does not exist but they do) and sow a seed in their life - it does not have to be financial, it could be a compliment, it could be a listening ear, you are only limited by your imagination. But, sow something positive into their life. I'm a big believer that you reap what you sow.
Irrespective of how things turn out with this investigation, Gene will reap what he has sown. Whether it is here or in the afterlife, he'll reap what he's sown and I don't have to be the judge of when, where and how that takes place. I'll leave that to my Maker to do.
Blessings everyone!
P.S. - Pardon any grammar or spelling errors.
Thank you for your efforts to provide the Receiver’s team information on bank accounts utilized by Pinnacle. However, PLEASE DO NOT post bank account and routing information on this public forum.
Please email this information to Linda Baldwin at [email protected] so that we may immediately identify any accounts where investor funds were deposited or paid.
If you have posted any bank account information previously, please delete that information from your prior post and send it in an email Ms. Baldwin or in a private message (PM) to Value Adder.
S. Gregory Hays, Receiver
Thanks for that post justaninvestor,
Fellow investors please remove the bank account info posted by you. Previously we wasn't thinking of the efftect this would have on others who might use this the" EVIL "way.
Please go back and delete and send all other previous info directly to the email above. Moderator I suggest you enforce if not remove them yourself.
Our intentions are good to help ourselves but others might not see it that way, especially those trying to steal information or more of our monies.
Don't forget this is a public site. :crazed:
Thanks again,
nealhope
Fees by the receiver can be made up by recovery from other sources. Perhaps we will prevail with a claim by the SEC against the attorney. A claim against him is part of our pursuit against Pinnacle.
I have spoken with the receiver and I find him to be very credible and hard working. He wants everyone to know that he will be efficient. FYI: I did not take up much of his time.
I am part of the 6 figure club. I share the emotional loss with everyone.
I am hoping to find out that each account equals an investor. This is to our advantage because we might have fewer investors with multiple accounts. We all need to get our claims in ASAP.
Isn't the purpose of this forum to help? So why is everyone trying to blame other people for their own mistakes? Why are people trying to blame the SEC, the receiver, their advisor, etc . . . .
You have no one to blame but yourself! WE WERE SCAMMED!! Face the facts! No one held a gun to your head and made you invest your money.
We should be trying to help the Receiver by giving him anything and everything we know to help him do his job as fast and effectively as possible. Instead we are all just complaining and saying a bunch of what if this and what if that. That is only fear talking. Don't feed the fear!
Yes it sucks, yes it's hard to believe that someone would do this and yes I want to believe that people are honest and have integrity. The truth is not everyone has it. So lets try to help each other instead of blame others. When one door closes another one opens.
Scout,
Explain what you're talking about. I think no matter how much a person invested, it's important money to them. A person who lost $100,000 but makes $500,000 a year and the person who lost $10,000 but makes $50,000 is the same percent wise. I'm not getting what you want the six-figure clubbers to do for you. Also, watch your mouth! I'll have to force feed you some Prozac!
Ooops....Scout got spanked by the moderator! :lol:
One of the reasons I trusted Pinnacle was because they were allowed to run a full page ad in Newsweek Magazine (and also were sanctioned by the Better Business Bureau). I thought Newsweek always vetted their advertisers?
Maybe Newsweek would be interested in making up for this oversight by contributing the huge profits they must have made from Pinnacle's glossy ads back to us poor investors?
- Gene has bulk of the money tucked away somwhere which he would have used to pay up all his inevstors. He promised till last day that there is enough money to pay not only principal but last return as well
- Gene was planning to go agressive in his consulting business and had lined up over 200 seriously intersted investors - he would have used that proceeds to make good on his promise to pay up all investors to last penny. [code:1]He has to make a clean break from pinnacle development in order to sucessfully launch consulting business
- it is possible that he would have rolled over some of the big investors into consulting project in lieu of paying up their principal. Consulting was a legitimate way of doing real estate business putting investors eventually in charge of operations[/code:1].
- It is possible that he would have asked group of investors located in
specific city or belonging to family to form a group subscribing to consulting concept in lieu of repayment of their principal. In a nut-shell, gene would have found ways to keep all investors compensated if he ran out of funds to payup or his consulting project would have been DOA.
Consider the probable scenerio due to SEC intervention
- Gene knows (his legal team must have advised him what lies ahead) his scheme can not stand SEC violations and he knows funds will be frozen by SEC - so what is he supposed to do but save as much as he can and hide
- Gene might have anticipated SEC moves and may have money hidden in unreachable places - so now investors have no access to such funds. Suddenly, there is not enough money to pay even principal amount in frozen accounts
- Gene has ample time to destory most of the money trail and key records. Why would he not do it? He does not have any incentive to keep his promises to investors now that law-agencies have taken over
- Even if Gene is eventually punished by laws, he may be sitting on millions and laughing at everybody after he gets out
Notwithstanding what receiver said here, read his covering letter in the claim form - it makes no bones about this process being expensive and long-drawn. [code:1]Now we are told that investors will get only % of loss-portion of their original capital and not full capital because there won't enough funds after gene, sec and receiver are done with their take and assets in distressed circumstances can't fetch even maket values. Allegations of ponzi scheme has created a self-fulfilling prophey in which everybody would win except investors.[/quote][/code:1]
GOOD POINT. I THINK THE SAME WAY. WHAT IS DONE IS DONE. NO ONE KNOWS THE WHOLE TRUTH. THEY DIDN'T GIVE THE GUY A CHANCE.
I STRONGLY BELIEVE IF SEC DIDN'T STEP IN WE ALL HAVE GOTTEN OUR PRINCIPAL +RETURNS. EVENTHOUGH I LOST SO MUCH, I DON'T BELIEVE HE WAS A CROOK. FOR THE SIMPLE REASON HE COULD NOT MOVE TO CONSULTING SUCESSFULY WITHOUT GOOD REPUTATION FROM CURRENT INVESTORS. THE GUY IS NOT STUPID.
We received tax information in the mail today. Date stamped Fiday the 13th! It was sent out on Friday! It seems that someone is working in the office of Pinnacle...Anybody else receive this today?
What a nightmare, now getting K-1 Forms and now tax information.
This pinnacle vs SEC reminds me of another episode with a bank that occured in another country in which my dad lost $2m. I will not name the country, bank or local currency because they are not relevent. The bank had deposits of over $4,500m and was considered the largest private bank in the province and local economy benefited and depended heavily on it. It was rock solid bank with solid history for over 20years. The owner/CEO of the bank had made unauthorized loan to his family worth $200m(hardly 5% of total bank portfolio) which he would have repaid in due time. But somehow influential media got the wind of such loan and soon Bank regulators got involved and overnight, they locked down the bank and froze the bank assets, and threw all directors in jail without bail and appointed a receiver. There was panic among over 10s of thousands of depositors who had their entire life savings in the bank. But they could do nothing for years as the bank remained locked-up for years. The receiver had no clue about extent and complexities of bank's operations and those who were in the best of knowledge and position to recover bank loans were thrown in jail for a year before prosecutor could bring the case to court which eventually acquitted all the directors except owner/CEO. But in the mean time, loan recovery fell wayside due to mismanagement, ineffeciency and fraud as many loan-holders found ways to trick or bribe their way out of loans, in the end banks was left with hardly any money to pay up depositors. Eventually, central/treasury bank stepped in and started paying up from its own coffers - not full deposit amount but partial amount with a ceiling of $100k per depositor (most depositors had multiple accounts with aggregate total way over $100k) and that too after 4 years of delay, most larger depositors had to wait even more years to get back small part of their deposits. Thousands of families, retirees, poor folks got ruined for life in the process. All because media and bank regulators saw a technical violation and jumped the gun to protect the depositors but their action ended up blowing up the whole bank and majority of its depositors of their life savings. I know this is largely unrelated to our pinnacle scenerio. But since it happened to my family and now it is happening to me all over again, i could not help relate both events that have effected me.
Somebody in accounting is really goofing up k-1. A friend of mine received a K-1 for wrong amount in the name of corporation that did not exist in 2005, Same way, another friend got K-1 for 2005 even though he opened the account only in 2006. Another friend got K-1 for more amount than he earned in 2005. One guy who made money in 2005 did not receive his k-1 at all. What is going on? Who is going to correct such defective k-1? Not to mention all the tax-preparation fees investors will have to fork out to file amended tax returns with penulty and interests perhaps. Is pinnacle accounting staff purposely goofing off or they really have no clue who invested what and when and how much they earned? Implications with IRS can be serious for some investors.
O'Neal is a crook plain and simple. Did he disclose his being fined and sentenced to probation for forgery in 1998? Hell, no!! I don't care if he got a recommendation from the man above, after that I would never have invested in Pinnacle had I known this.
Pinnacle reps were the ones telling us about the conversion to the consulting business, very convenient I might add, but what proof was there that a legitimate consulting business was forthcoming?? NONE!!! Just their word which as we can see means squat!!!
There is no way Pinnacle had the funds to pay off all the investors. I guarantee that the few that got paid at the very end were a smoke screen. Did any 6 figure investors get a check at the end? NO!!! Just a few smaller investors who immediately reported "I GOT MY CHECK"!! It was a cover to allow them more time to shift funds to harder to trace locales. Would the rest of us seen our money if the SEC hadn't stepped in?? You are living in Fantasyland if you believe this.
YOU ARE RIGHT. NOW THAT YOU MENTIONED ABOUT HIS SENTENCE IN 1998 FOR FORGERY, I TOTALY AGREE WITH YOU I WOULDN'T INVEST WITH PINNACLE EITHER.
Yag
Friend of mine personally visited pinnacle on 5th for consulting project and he came out convinced to invest in it. The new team of lawyers were working on details in order to make it public within couple of weeks. Pinnacle had large pool of satisfied investors and pinnacle had nothing to lose by offering consulting services to them
Wheather pinnacle had sufficient funds or not, wheather it ran a fraud or ponzi scheme or not are pure speculations at this point. They are allegations but not proven yet. They may or may not be true. And now, they may be hard to prove or disprove as SEC's actions have created self-fulfilling prophesy and altered realities. In 2-3 weeks, we all would have found it out, but now we have no way to find out the truth. Now we are given an altered reality as truth.
I also got a K-1 today for 2005. I invested $7500 Dec.15,2005. I wasn't due a return until Jan. 30,2006. Unless they consider the last 15 days of Dec. interest earned, I don't know what this is for. They show $288 as Fed. income. They show the same $288 as self-employment earnings and again as Georgia income. I was told by Nick Rogge that until this year G. O'Neal always paid the Georgia income tax for the investors.( BS I'm sure..)
So why did I get a 2005 K-1, not a 2006? Also why did I get a 2005 K-1 if Gene paid the tax prior to 2006. Mostly if this is actually for 2005, isn't it a bit LATE?
I pray that we will receive our money before it is too late. Yes, I invested $150K with Pinnacle and received my returns on time as noted by my consultant on the matured date. There have been a great deal of comments that Pinnacle was a fraudulent company and they were crooks but each individual investor who received there 25% was not complaining about the company when they received their return. Not only did we invest, we re-invested our returns. Many investors had attorneys, their lawyers, and themselves look into this company that was seemingly giving the ordinary individual a window of opportunity to make a nice return on their investment. Trips were taken to Atlanta, meetings attended, and everything seemed as legitimate as a business can be. I talked to my advisor on Monday, October 9 and was assured that Mr. Oneal was going to pay all investors their last return before venturing into Pinnacle Consulting. Ashley repeated that Mr. Oneal didn't want to leave investors standing in the cold and didn't want to ruin his reputation with the community, BBB, and his credibility. I do believe that we would have gotten our investment back if the SEC wouldn't have frozen Pinnacle's account. Pinnacle didn't close their doors and stop answering their telephones. If Mr. Oneal is a true crook, he would have taken the money and left a long time ago. It still doesn't make since to me to believe that a thief would deposit 16 million dollars in the bank to defraud the investors or any money for that matter. I, like many others, need my money that is sitting in an account that will be given back to me as a percentage. Yes, I had a good thing going with Pinnacle and now my life is about to take a full circle going in the wrong direction. We can speculate and assume that the SEC froze Pinnacle's assets to protect the investor from continued defrauding but is that the real truth? I haven't read or heard one comment from an investor saying they didn't get their return. Now there is an Attorney involved and we haven't got a clue as to when we will receive our funds. One thing for certain, I'm sure the law firm will get its share, maybe it will be 25%.
I don't see Gene O'Neal or his legal counsel here making a statement. He knows we are here. I would be more receptive to the argument that it wasn't a con and he planned on going forward with consulting if he showed concern and let investors know that he was handling the matter.
This didn't started as a Ponzi, it Metamorphosed into one. It took on a life of its own when all the money came in. I think some of you are right that he may have had plans on turning things around, but the lack of info turned him into a criminal.
"Hey Robert, do you know how to do the running man? :D " Gene I've been doing it since the sec came in, Now get off my sattelite phone. I need to paddle this canoe faster, I saw Nick Rogge when I passed Iceland. He looks pissed. I think they relized they have no 401K, hehehehehe :mrgreen:
:crying:
Question,
If there are properties owned by Pinnacle, wouldn't they belong to the investors now?
If we owned them we could sell them in the future for a hire return as the market improves. We could still work as a team, and help each other out.
Just a thought.
[/b]
Greg/Linda..
Many of us just rec'd K-1's for 2005.. they were mailed from Pinnacle's office & post marked Oct. 13th..
Did someone from your office prepare & mail these??
Who can we talk to for corrections, copies of the partnership tax returns, etc..???
- Gene has bulk of the money tucked away somwhere which he would have used to pay up all his inevstors. He promised till last day that there is enough money to pay not only principal but last return as well
- Gene was planning to go agressive in his consulting business and had lined up over 200 seriously intersted investors - he would have used that proceeds to make good on his promise to pay up all investors to last penny. He has to make a clean break from pinnacle development in order to sucessfully launch consulting business
- it is possible that he would have rolled over some of the big investors into consulting project in lieu of paying up their principal. Consulting was a legitimate way of doing real estate business putting investors eventually in charge of operations.
- It is possible that he would have asked group of investors located in specific city or belonging to family to form a group subscribing to consulting concept in lieu of repayment of their principal. In a nut-shell, gene would have found ways to keep all investors compensated if he ran out of funds to payup or his consulting project would have been DOA.
Consider the probable scenerio due to SEC intervention
- Gene knows (his legal team must have advised him what lies ahead) his scheme can not stand SEC violations and he knows funds will be frozen by SEC - so what is he supposed to do but save as much as he can and hide
- Gene might have anticipated SEC moves and may have money hidden in unreachable places - so now investors have no access to such funds. Suddenly, there is not enough money to pay even principal amount in frozen accounts
- Gene has ample time to destory most of the money trail and key records. Why would he not do it? He does not have any incentive to keep his promises to investors now that law-agencies have taken over
- Even if Gene is eventually punished by laws, he may be sitting on millions and laughing at everybody after he gets out
Notwithstanding what receiver said here, read his covering letter in the claim form - it makes no bones about this process being expensive and long-drawn. Now we are told that investors will get only % of loss-portion of their original capital and not full capital because there won't enough funds after gene, sec and receiver are done with their take and assets in distressed circumstances can't fetch even maket values. Allegations of ponzi scheme has created a self-fulfilling prophey in which everybody would win except investors.
kerty9,
I am sorry for your loses but I think once again like I said before you need to think clearly and consider the facts. Everything you just mentioned above is simply wishful thinking at best. But if you take a step back and consider the facts, you will realize there was no way in hell all investors would get paid in full.
Let's break it down (numbers might be a tad off). They had something close to 40mil of business 2005 and close to 60mil in 2006 before getting shut down. That's approximately 100mil they are forced by contract to pay 25% returns on, 25mil.
Thus far though investors have paid there has not been ANY EVIDENCE whatsoever that Pinnacle was actually running a legit business unless you consider selling yourself your own properties a business. So, unless can actually has heard something different, Pinnacle was generating ZERO income for the last 2 years. I don't think you can argue with me on this point, and it's very critical you agree with me on this point.
Assuming you accept the fact Pinnacle had no real business model that generated any legit income besides taking in new investor's money.
They had to payout 25mil + referral bonuses + operating expenses(lease, overhead, utilities) + travel & entertainment...
Where, kerty9, are you telling me this money could have come from? I don't care if investors were getting paid on time, that's not a valid argument. All that shows is that investors were getting paid by new investors, which is exactly how a ponzi works. In sept he stopped taking in new inevestments which meant all his reserves would have dried up. If you really think Gene was going to pay everyone a combined 25mil+, you are living in a dream world. If he had 25mil+ of personal assets you think he would have even started this shady operation in the first place? Just so he can use his own personal assets to pay investors amazing returns? Because his business, once again, was obviously not generating ANY income.
Think about it.
I think an answer from the receiver is due to us shortly of how long they were looking at Pinnacle...........Why wasnt the approach of 'confronting" him done first.
Consult, audit....whatever the hell you call it. We need to hear something that this was the only and / or approach to take .....
If not Hays, then the SEC should make a statement why this direction was taken.
I still think O'neal is a worthless piece of "duty".........But to freeze with out 100% certainess is costing us all thousands....Not to mention stress beyond belief.
Correct me if i am wrong
Scout,
Hays and his staff are professionals. Let's not forget that Pinnacle was under investigation by the SEC for several weeks before they came in and froze assets. You have to assume that during the weeks prior to them coming in, they had done enough due diligence to warrant a formal investigation and freezing of any assets of Pinnacle to avoid investors from any further harm.
Hays and his staff didn't fall off the turnip truck yesterday and start fraud investigations. Look at their website, they've done this a number of times. While we would all like to make assertions that all might be well had they let Pinnacle continue on the course they were on, I would beg to differ (I already addressed my reasons in a prior post so you can reference that post).
Bottom line - Hays and his staff are professionals. This is NOW officially out of our hands. Let's let the professionals do what the professionals do and try to aid in their efforts by cooperating as best as we can instead of 2nd guessing every step they or the SEC have taken.
As difficult as it may be, we need to give them time to complete their work. We've all waited a while for promised returns from Pinnacle. Let's give Hays and his staff 45 days to complete their work and file the necessary papers with the courts that will answer many questions we have.
I personally am getting tired of everyone hinting or trying to blame Hays or the SEC for their involvement. As someone else said, neither Gene nor Kunkel nor anyone else held a gun to our heads and said invest. Irrespective of their 3rd party involvment in various phases of this at the end of the day, we need to hold ourselves responsible for what's taken place.
Part of the problem is we most likely were being scammed by Gene and participating in a ponzi scheme - time will tell on this point. The other problem is let's face it, we let greed get the best of us and failed to exercise sound money management principles by investing more than we would have cared to have lost. I know I certainly did!
By the way, it is standard operating procedure to freeze assets while conducting further investigation to protect investors. I unfortunately have experienced that before.