The SEC has moved to halt an alleged $300 million real estate Ponzi scheme that defrauded more than 2,000 investors.
The action has been taken against Drive Planning LLC, based in Atlanta, and its founder and CEO, Russell Todd Burkhalter. The SEC secured a preliminary injunction, asset freeze, and other emergency measures to prevent further harm. A receiver has been appointed to oversee Drive Planning.
Allegations of Misappropriation and Lavish Spending
Drive Planning and Burkhalter are accused of misappropriating millions of dollars from investors.
These funds were allegedly diverted to support Burkhalter's extravagant lifestyle. This includes the purchase of a $3.1 million yacht and $4.6 million spent on chartering private jets and luxury car services. He is also accused of spending $2 million on a luxury condominium.
The SEC contends the defendants engaged in Ponzi-like practices, using money from new investors to pay returns to earlier investors.
Nekia Hackworth Jones, Director of the SEC’s Atlanta Regional Office, said:
“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.”
The Scope of the Alleged Fraud
The SEC's complaint alleges how, between 2020 and at least June 2024, Drive Planning and Burkhalter raised over $300 million from investors under the pretense of funding real estate developments. It claims investors were promised a 10 percent return every three months, with some even being encouraged to deplete their savings, retirement accounts, and open lines of credit to invest.
However, the SEC asserts the defendants lacked a legitimate business model capable of delivering these promised returns.
Legal Actions and Penalties
The SEC's complaint charges Drive Planning and Burkhalter with violations of the antifraud provisions of federal securities laws. In addition to the emergency relief measures, which were unopposed by the defendants, the SEC is pursuing permanent injunctions, disgorgement of ill-gotten gains with prejudgment interest, civil penalties, and an officer-and-director bar against Burkhalter.
The complaint also names Jacqueline Burkhalter, Burkhalter’s spouse, and several related entities as relief defendants, seeking the return of illicit profits.
