Disclaimer: The following information is based on court filings, investor communications, and public sources. It is presented solely for informational and awareness purposes.
As with other properties, the Karney Group assumed operational control over a real estate asset that included investment funds from more than 30 investors. Following this, the group allegedly informed the lender of their intent to default on the loan and declined to execute a Pre-Negotiation Agreement. This refusal reportedly caused delays and complications for the lender’s legal team and impeded resolution efforts.
Due to these events, investors incurred approximately $1.1 million in collective losses as they attempted to prevent foreclosure and stabilize the property. While the plaintiffs worked to address the default with the lender, it has been alleged that Shiba Prop was used to redirect or process certain debt service payments during this period.
