UDF III Appoints New Chief Financial Officer
The general partner of United Development Funding III LP, a non-traded limited partnership, appointed Stuart Ducote as its chief financial officer, according to a filing with the Securities and Exchange Commission.
Ducote replaces Cara Obert who resigned to concentrate on her role as chief financial officer and treasurer of United Development Funding IV and United Development Funding Income Fund V, the company said. Obert will continue to serve as chief financial officer of UDF III’s general partner, UMTH Land Development LP.
Ducote has served as president and chief financial officer of affiliate United Mortgage Trust since 2009. Since July 2016, he has also served as a managing director of BlackBriar Advisors, a financial services company. He spent four years as chief financial officer of E2 Energy Services, which builds, owns, and operates natural gas compressor stations and related equipment, and from 2006 until 2008, he co-owned private real estate firm Ultra Realty.
During his career Ducote has served as the chief financial officer of numerous public and privately held companies, including international franchise firm, Humitech International Group, human resources firm People Solutions Inc., internet-based recruiting firm Jobs.com, and Provident Bancorp of Texas. He is a graduate of the University of Texas.
The company, which is currently under investigation by the Securities and Exchange Commission, disclosed that it received a Wells notice from the SEC last year along with United Development Funding IV, an affiliated publicly traded REIT that was delisted from trading on NASDAQ in October 2016.
A Wells notice is not a formal allegation or a finding of wrongdoing, but is a preliminary determination that the SEC sends to individuals or firms when it is planning to bring an enforcement action against them.
United Development Funding III has not filed any quarterly financial documents since November 2015 and recently informed the SEC that it will not meet the deadline for filing its 2016 year-end report. The company said that its independent registered public accounting firm, EisnerAmper, is conducting an internal audit of the firm and is working to complete and file all of the necessary periodic reports.
Federal authorities raided UDF headquarters in February 2016 nearly two weeks after Kyle Bass, hedge fund manager and founder of Hayman Capital Management – which is shorting UDF IV, publicly accused the real estate investment trust of operating a “Ponzi-like real estate scheme.” The outcome of the FBI investigation is pending.
