The Securities and Exchange Commission has charged Keith R. Gebert, the founder, sole owner, and managing member of former New Jersey registered investment adviser Rightbridge Private Capital LLC, with fraud for failing to disclose referral fees he received in connection with recommendations to advisory clients.

According to the SEC’s September 24, 2026 order, Gebert advised approximately 36 clients to invest roughly $10 million in a private fund focused on real estate investments between October 2020 and March 2023. The SEC found that Gebert received more than $500,000 in referral fees from a real estate company affiliated with the fund, but did not disclose that compensation to the clients he advised to invest. The real estate fund later stopped operating, and nearly all of the affected clients have reportedly been unable to recover their investments. (SEC)

(SEC ADMINISTRATIVE PROCEEDING
File No. 3-22753)

Why the Undisclosed Fees Matter
Investment advisers owe fiduciary duties to their clients. That includes a duty to disclose material conflicts of interest that could influence the advice an investor receives.

An adviser may have a financial incentive to recommend a particular private fund when the adviser receives referral fees, commissions, or other compensation connected to the sale. The existence of compensation does not automatically make a recommendation improper. The problem arises when the adviser fails to disclose the conflict clearly enough for the client to understand that the recommendation may be influenced by the adviser’s own financial interest.

The SEC found that Gebert’s failure to disclose the referral fees breached his fiduciary duty and contradicted material representations made to clients. (SEC)

For investors, the key question is straightforward. Were they told that their adviser would be paid for recommending the real estate fund?

If the answer is no, investors may have reason to examine whether they received complete and candid advice before committing money to a private and illiquid investment.

Private Real Estate Funds Can Carry Significant Risk
Private real estate funds are often presented as an opportunity to earn income, diversify a portfolio, or gain exposure to real estate without directly owning property. But these investments can carry risks that differ sharply from publicly traded stocks, bonds, or mutual funds.

Common risks may include:

Limited or nonexistent liquidity
Difficulty obtaining an independent value for the investment
Dependence on the sponsor or manager
Delays in distributions or redemptions
Borrower defaults or declining property values
High fees and expenses
Conflicts of interest involving fund affiliates
The potential loss of some or all invested principal

An investor who needs access to capital, depends on regular income, or has a conservative investment objective may not be an appropriate candidate for a speculative or illiquid private real estate fund.

The SEC’s Order and Financial Sanctions
Without admitting or denying the SEC’s findings, Gebert agreed to a cease and desist order and an industry bar. The bar prevents him from associating with investment advisers, brokers, dealers, and investment companies, among other covered entities.

The SEC’s order also requires Gebert to pay:

$509,350 in disgorgement
$135,138 in prejudgment interest
A $150,000 civil penalty
These payments are regulatory sanctions. They do not automatically mean that every affected investor will receive full repayment of losses. Whether and how investors may receive funds can depend on the terms of any future SEC distribution process, available assets, separate litigation, insurance coverage, bankruptcy issues, and other facts. (SEC)

What Affected Investors Should Review
Investors who worked with Rightbridge Private Capital or Keith Gebert should review the documents they received before investing in the private real estate fund.

Important records may include:

Advisory agreements
Private placement memoranda
Subscription documents
Account statements
Emails and text messages
Investment presentations
Financial planning materials
Notes from meetings or telephone calls
Fee disclosures
Tax documents
Records of distributions, redemption requests, or failed withdrawal attempts
These records may help show what the investor was told about the fund’s risks, liquidity, expected returns, fees, and the adviser’s compensation.

Possible Investor Recovery Options
The SEC proceeding is important, but it may not be the only avenue available to investors. A regulatory case focuses on the government’s enforcement authority. A private investor claim focuses on whether the investor suffered losses because of undisclosed conflicts, misleading statements, unsuitable recommendations, negligence, or other actionable conduct.

Potential recovery options may depend on the specific facts and could include a private arbitration claim, court litigation, a claim against another firm involved in the recommendation or sale, or participation in a future SEC distribution process if one is established.

The appropriate path depends on matters such as:

The investor’s relationship with the adviser
The documents signed before the investment
The disclosures that were or were not provided
Whether a broker dealer or registered representative participated in the transaction
The amount invested and losses incurred
Applicable legal deadlines
The parties with available assets, insurance, or supervisory responsibility
Not every investor will have the same claim or recovery opportunity.

A Regulatory Finding Does Not Restore Lost Funds by Itself
The SEC’s action establishes serious findings concerning undisclosed referral compensation. It does not, by itself, restore the money invested in the private fund.

For many affected investors, the immediate problem remains the same: a substantial investment in a real estate fund that ceased operations, with limited or no ability to recover the capital.

Investors should be cautious about waiting indefinitely for an outcome. Legal deadlines may apply to private claims, and documents, account records, and communications can become more difficult to obtain with time.

Rightbridge Private Capital Investor Losses
The Rightbridge Private Capital matter is a reminder that investors deserve to know when an adviser has a financial interest in recommending a particular investment.

A private real estate fund may be appropriate for some sophisticated investors who understand the risks and can tolerate a long holding period. It may be unsuitable for investors who were seeking safety, liquidity, predictable income, or preservation of principal.

Sonn Law Group is reviewing potential claims involving undisclosed compensation, private fund losses, conflicts of interest, and unsuitable alternative investment recommendations.

This article is for informational purposes only and does not constitute legal advice. The SEC action against Keith R. Gebert was settled without Gebert admitting or denying the SEC’s findings. The existence of an SEC order does not determine the merits or value of any individual investor claim.