Hotel Investors Lost $70 Million in Real Estate Scheme, SEC Says

A hotel ownership and management company’s founders defrauded two sets of investors of more than $70 million in a scheme related to 13 properties, the SEC alleges in an enforcement suit.

The hotels included Holiday Inn, Embassy Suites, and Sheraton properties in Anaheim, Calif., Orlando, and other locations, along with the repurposed Queen Mary ocean liner in Long Beach, Calif., according to the complaint.

The founders of now-defunct Urban Commons LLC, Taylor Woods and Howard Wu, told the first group of shareholders that a third party was buying the hotels, the Securities and Exchange Commission says. But they were instead ...