Texas Regulators Ordered Lasater RE Fund Refunds
State officials directed the fund to repay investors after issuing a cease and desist order earlier this year.
Updated on Sept. 22, 2026 in Commercial
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In June 2026, the Texas State Securities Board issued a cease and desist order against Lasater RE Fund 14. Following negotiations, regulators dropped initial fraud claims in August 2026 and ordered the fund to provide refunds to investors.
Why it matters
The action followed findings that the firm failed to disclose material information regarding the financial condition and operational history of affiliated entities. This lack of transparency hid loan defaults exceeding $100 million within those connected organizations.
The fund successfully sold $5.6 million in securities out of a $10 million target, with sales resulting in $750,000 in commissions. These commissions represented a 13.4% rate for the 50 investors involved in the offering.
The players
Texas State Securities Board
This is the state agency responsible for the administration and enforcement of the Texas Securities Act.
Lasater Capital
This is the investment firm that marketed real estate opportunities and faced regulatory action regarding its fund.
Stephen D. Patterson
He is a registered representative associated with J. Alden Associates Inc. who was linked to the fund offering.
J. Alden Associates Inc.
This is a financial firm headquartered in Wayne, Pennsylvania, that employs 100 registered representatives.
The details
Lasater Capital marketed the fund as an opportunity to invest in multi-family and real estate-related assets, but the firm later faced scrutiny over its ties to entities with significant loan defaults. Stephen D. Patterson, a representative registered with J. Alden Associates Inc., was linked to the firm during the period of the fundraising efforts.
Timeline
May 5, 2026: Regulation D filing date for the fund.
June 2026: Texas regulators issued a cease and desist order.
August 2026: Regulators dropped fraud claims and ordered refunds.
Culture Shift
The enforcement action highlights the critical importance of meeting disclosure obligations under Regulation D when soliciting private investments. It underscores a broader trend of increased regulatory scrutiny regarding the transparency of private real estate equity funds.
Investors who participated in Lasater RE Fund 14 may be eligible for refunds following the state-mandated resolution. Individuals should monitor official state communications to determine the specific process for recovering their capital.
The takeaway
Transparency remains the primary safeguard for individuals participating in private real estate placements. Investors should always conduct rigorous due diligence on the financial health of any affiliated entities before committing capital to a fund.
Further reading
For more on the regulatory landscape in the state, visit the Texas Commercial section.
Source note: This article includes information reported by InvestmentNews.
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