YieldStreet, an accredited crowdfunding platform offering access to alternative securities offerings including real estate-based securities. Typically, YieldStreet looks to list short term investment opportunities, that are uncorrelated with traditional markets, that generate income for individual investors. YieldStreet may list securities tied to art, legal or other esoterics.
A report today, alleges that YieldStreet may be in hot water as the platform is said to be under investigation by both the Securities and Exchange Commission (SEC) and the Federal Bureau of Investigation (FBI) – regarding certain offerings and the marketing of these products.
According to WSJ.com, the investigation revolves around non-traditional offerings pertaining to loans linked to “ship breaking.”
This has to do with extracting metal and harvesting parts of value from older ships. The report claims that approximately $90 million in loans were sold to investors for ship breaking. Apparently, “roughly a dozen” ships that were collateral for some of these loans have disappeared.
The write up references a single investor who was apparently interviewed by the FBI. This individual said he believed he was investing in a diversified portfolio of these assets when it came to light they were all from the same borrower.
Crowdfund Insider has reached out to YieldStreet for a comment. Of note, an investigation is not a determination of any wrongdoing by YieldStreet. YieldStreet reportedly told WSJ.com that they did not believe they are the target of any investigation.