SEC, Woodbridge nearing settlement

Bankrupt real estate developer Woodbridge of Cos. and the Securities and Exchange Commission are nearing a final settlement deal they hope to bring to a Miami federal judge by Nov. 2, according to court filings.

The settlement would come after the SEC launched an investigation into Woodbridge, the developer of high-end properties mainly in the Colorado and California, for securities fraud in November.

Woodbridge has a number of properties in the Roaring Fork Valley for sale; in August it sold the old McCoy Armory Building, most recently occupied by Colorado Mountain College at 831 Grand Ave. in Glenwood Springs, for $1.1 million to a Basalt investor.

The SEC probe, which led to its civil complaint in December against the company for allegedly engineering a $1.2 billion Ponzi scheme, pushed Woodbridge into Chapter 11 bankruptcy the same month.

The SEC claims Shapiro engaged in the Ponzi scheme by promising high returns to more than 8,400 investors by paying off earlier investors.

In the meantime, the SEC has been negotiating with Woodbridge, which is based in Sherman Oaks, California, and its former president, manager and CEO, Robert Shapiro, over settling the SEC’s civil charges and winding down Woodbridge’s bankruptcy, court records show.

“The parties are now pleased to announce to the Court that they have recently resolved all of these outstanding issues, and all documentation which is needed to effectuate the settlement has been finalized and executed, and all conditions precedent to the settlement have similarly been finalized,” wrote an SEC attorney in a filing made Oct. 1 in the U.S. District Court of the Southern District of Florida, the venue for the SEC’s suit against Woodbridge.

The SEC still must bless the settlement agreement before advancing it to the judge for final approval, the filing said.

Shapiro, who once lived at Aspen Glen in the lower Roaring Fork Valley, has denied the allegations against him.

Settlement talks in the SEC lawsuit have been ongoing for months. A Miami federal judge’s order in May said the defendants had consented to a judgment “without admitting or denying the allegations” in the SEC’s complaint.

Woodbridge’s Chapter 11 bankruptcy in Delaware, a proceeding that allows it to reorganize its debts while staying in business, has resulted in it selling off properties in the valley to pay back its creditors.

Since Sept. 1, the bankruptcy court has given Woodbridge permission to sell three single-family in Snowmass Village on Two Creeks Road, Branding Lane and Spur Ridge Road.

It also has sold other local residences as part of its Chapter 11 reorganization, The Aspen Times reported in May.