RAD Diversified REIT Losses?

Soreide Law Group is investigating potential investor claims involving RAD Diversified REIT Inc., specifically focusing on whether brokers or financial advisors improperly recommended this non-traded real estate investment trust despite mounting red flags. RAD Diversified REIT raised investor funds to acquire and manage real estate assets nationwide, positioning itself as an accessible way for individuals to invest in real estate. However, significant adverse developments—including regulatory investigations and bankruptcy—have raised serious concerns. The following summarizes key details investors should understand.

Overview

RAD Diversified REIT Inc. is an externally managed real estate investment trust formed to acquire, renovate, and operate income-producing properties such as single-family homes, multi-family units, farmland, and vacant land. The company was controlled by founders Brandon “Dutch” Mendenhall and Amy Vaughn through an affiliated management entity.

The REIT raised capital from more than 5,000 investors through Regulation A and Regulation D offerings, as well as private placements, promissory notes, and joint venture arrangements. Investors contributed between approximately $1,000 and over $1 million, often through self-directed IRAs. The company marketed heavily through social media, online content, and live seminars. Sometimes, it encouraged investors to use home equity lines of credit or even credit cards to fund investments. That is an uncommon practice for securities offerings.

RAD reported owning over 300 properties across multiple states, with a concentration in residential real estate assets.

Investor Concerns About RAD Diversified REIT

RAD Diversified REIT has faced extensive regulatory, financial, and operational concerns. In July 2025, the Florida Attorney General issued subpoenas after receiving complaints that investor funds may not have been used as represented. The Attorney General suggested the operation “appears to be a Ponzi scheme.” Investors reported being unable to withdraw funds or receive expected returns.

The SEC also declared the company’s Regulation A offering “abandoned,” effectively cutting off access to new capital. At the same time, the company froze its share redemption program, preventing investors from liquidating their positions.

In March 2026, RAD filed for Chapter 11 bankruptcy protection. It reported estimated assets and liabilities between $50 million and $100 million. This has left thousands of investors uncertain about recovery.

Additional red flags include allegations of misleading return projections, lawsuits alleging fraud, reports that some properties were vacant or overvalued, foreclosure actions across parts of the portfolio, high insider management fees consuming a large portion of expenses, and inadequate documentation of investor ownership interests.

Potential Sales Practice Violations

Brokers and advisors recommending RAD Diversified REIT may have failed to disclose material risks specific to this offering. These include the REIT’s dependence on continuous fundraising to sustain operations. Omissions could have also been made about suspension of redemptions, lack of liquidity due to its non-traded structure, and increasing regulatory scrutiny prior to the bankruptcy filing.

There are also concerns that some advisors may have relied on company-provided marketing—such as projected returns and property valuations—without independently verifying the accuracy of those claims. Recommending this investment to conservative or income-focused investors may have been unsuitable given the speculative nature, leverage, and operational issues. Additionally, failure to explain how investor funds were used, or the complexity of multiple affiliated entities and intercompany transactions, may constitute misrepresentation or omissions. Investors who suffered losses may have grounds to pursue recovery through FINRA arbitration or other legal remedies.

Did You Incur Losses By Investing In RAD Diversified REIT?

Do you need clarification on any losses on RAD Diversified REIT Inc. because of your financial advisor or securities broker? You should contact Soreide Law Group at (888) 760-6552 or online. Talk to a securities lawyer concerning a potential recovery of your investment losses. Soreide Law Group has recovered losses for many investors throughout the country. The firm works on a contingency fee arrangement and advances all costs.