On August 20, 2018, the Commission filed a complaint (the “Complaint”) against Lynette M. Robbins (“Robbins”) and Knowles Systems, Inc. (“Knowles”) (collectively, the “Defendants”). The Complaint alleged that, from at least March 2014 through December 2017, the Defendants violated the federal securities laws by serving as unregistered brokers on behalf of Woodbridge Group of Companies LLC and its affiliates, raising approximately $147 million from the offer and sale of unregistered securities to more than 540 retail investors. For their efforts, Robbins, through Knowles received significant transaction-based sales Commissions. See Complaint.

The Defendants were ordered and have paid a total of $1,123,360.49 in disgorgement, prejudgment interest, and penalty to the Commission as provided in the Final Judgments. The Commission was ordered to hold all funds, together with interest and income earned thereon (collectively, the “Fund”), pending further order of the Court. See Robbins’ Final Judgment and Knowles’ Final Judgment. 

On February 27, 2019, the Commission filed a motion (“Motion”) for the creation of the Fair Fund and requested the transfer of the Fair Fund to the Liquidation Trust established under the First Amended Joint Chapter 11 Plan of Liquidation of Woodbridge Group of Companies, LLC and its Affiliated Debtors (“Liquidation Plan”) (Motion’s Ex. A), for the benefit of creditors, most of whom are harmed investors, in accordance with the terms of the Liquidation Plan, in In Re Woodbridge Group of Companies, LLC, et al., Case No. 17-12560-KJ (D. DE). See the Commission’s Motion and Exhibit A 

On March 5, 2019, the Court granted to the Commission’s Motion and entered an order creating a Fair Fund for the $1,123,360.49 paid by the Defendants and transferring the Fair Fund, plus accrued interest, to the Liquidation Trust to be distributed to harmed investors in accordance with the Liquidation Plan. See the Court’s Order 

For more information, please contact the Trustee in In Re Woodbridge Group of Companies, LLC, et al., Case No. 17-12560-KJ (D. DE):

Timothy Jay Fox, Jr. 
Office of the United States Trustee 
U. S. Department of Justice 
844 King Street, Suite 2207 
Lockbox #35 
Wilmington, DE 19801
Telephone Number: 302-573-6491
Fax Number: 302-573-6497
Email: timothy.fox@usdoj.gov