Questionable dealings persist at Nicholas Schorsch’s AR Global, two years it was rocked by an accounting scandal, according to a recently departed director. Robert Froehlich, a board member at Realty Finance, a real estate investment trust managed by AR Global, left his position last month over concerns about a buyout offer from another AR Global-managed REIT, American Finance Trust.
Realty Finance failed to commission an independent review of the offer, Froehlich told the Wall Street Journal. And, in what he called a clear conflict of interests, the two funds shared the same chief financial officer.
“There’s no way in the world that you can sit as chief financial officer of two companies, one trying to buy the other,” Froehlich told the paper. “You have to act with undivided loyalty.”
Realty Finance defended the CFO, Nick Radesca, in a May Securities and Exchange Commission filing, saying it “strongly disagreed” with Froehlich’s allegation of conflict of interest.
Schorsch’s flagship company, American Realty Capital Properties, admitted in 2014 that it overstated financial results and deliberately concealed the error. It has since changed its name to Vereit, and is now led by Glenn Rufrano, former New York head of Cushman & Wakefield. [WSJ] – Ariel Stulberg