SEC v. Josephbenjamin, Inc., Just A Nice Day, Inc. — U.S. Securities and Exchange Commission Litigation Release No. 26366, dated August 4, 2025.
The SEC charged David Feingold, the Baldassarra brothers, and their companies with defrauding investors in the Broad Street Global Fund. They allegedly raised over $1 billion by making false claims about investment returns, commingling investor funds between different fund series, and diverting money for personal use. The SEC seeks to stop the ongoing fraud and recover investor losses.
In Plain English
Imagine you and your friends pool your money to invest in a special fund. The people running the fund promised to invest your money in different projects, like building houses or making short-term loans to businesses, and keep each project's money separate. However, they actually mixed all the money together, lied about how much money the projects were making, and even used some of the money for themselves. The SEC stepped in to stop this and get the money back for the investors.
Disclaimer: all facts are drawn from the SEC's own filings; the claims described are allegations unless and until a court rules or the parties settle, and some cases end in dismissal.
How the Alleged Scheme Worked
- Fund Creation and Investor Solicitation Defendants David J. Feingold and the Baldassarra brothers created the Broad Street Global Fund, LLC ('BSG Fund'), a private equity fund. They marketed various 'Series' within the fund, promising unique investment opportunities in areas like Real Estate Infrastructure, Merchant Cash Advances, and Custom Home Building.
- False Promises of Profitability The defendants allegedly misrepresented the profitability of certain investments, particularly in Merchant Cash Advances (MCAs). They claimed these investments generated significant profits when, in reality, they did not, leading to the payment of millions in unsupported returns to investors.
- Misleading Tax Treatment Claims Investors were falsely promised that funds invested in a specific Series, related to Qualified Small Business Stock, would generate tax-free returns. This was a misrepresentation, as the funds were not invested as promised and did not qualify for such favorable tax treatment.
- Commingling of Funds Contrary to their promises to investors, the defendants allegedly commingled funds and assets between different Series of the BSG Fund. This created cross-liabilities, exposing investors in one Series to the risks and debts of other Series.
- Diversion of Investor Capital Instead of investing investor funds as represented, nearly all of the capital raised was diverted. Approximately $880 million was transferred to BSG Management, and then about $170 million was further transferred to the Baldassarras and entities they controlled, including Relief Defendants Josephbenjamin, Inc. and Just A Nice Day, Inc.
- False Recordkeeping and Financial Statements The defendants also made false statements concerning the Fund's recordkeeping practices and financial statements. These misrepresentations obscured the true financial condition of the Fund and the fraudulent activities.
- Breach of Fiduciary Duty As investment advisers to the BSG Fund, BSG Management and the Baldassarras owed fiduciary duties of loyalty and care to their clients. The alleged misconduct, including commingling funds and misleading investors, constitutes a severe breach of these duties.
The Enforcement Action
On July 25, 2025, the U.S. District Court for the Southern District of Florida unsealed the SEC's Complaint, extended briefing deadlines, and ordered the Defendants to complete a previously ordered accounting by August 31, 2025. The SEC filed its complaint on January 29, 2025, alleging an ongoing offering fraud by David J. Feingold, Joseph B. Baldassarra, Steven S. Baldassarra, Broad Street Global Management, LLC, and Broad Street Inc. The complaint seeks injunctive relief, an asset freeze, and the appointment of a receiver. The SEC alleges violations of Section 17(a) of the Securities Act of 1933, and Sections 10(b) and 10b-5 of the Exchange Act of 1934, as well as Sections 206(1) and 206(2) of the Advisers Act of 1940.
Named in this action: Josephbenjamin, Inc., Just A Nice Day, Inc..