1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 

26 

27 

28 

Andrew Dean (NY Bar) 

Monique C. Winkler (Cal. Bar No. 213031) 

John K. Han (Cal. Bar No. 208086) 

 hanjo@sec.gov 

Heather E. Marlow (Cal. Bar No. 215261) 

 marlowh@sec.gov 

Amanda L. Straub (NY Bar) 

 strauba@sec.gov 

44 Montgomery Street, Suite 2800 

San Francisco, California 94104 

Telephone: (415) 705-2500 

Facsimile: (415) 705-2501 

Attorneys for Plaintiff 

Securities and Exchange Commission, 

Plaintiff, 

 v. 

Jonathan Larmore; ArciTerra Companies, 

LLC; ArciTerra Note Advisors II, LLC; ArciTerra Note Advisors III, LLC; 

ArciTerra Strategic Retail Advisors, LLC; 

and Cole Capital Funds, LLC, 

Defendants, and 

Michelle Larmore; Marcia Larmore; CSL 

Investments, LLC; MML Investments, LLC; 

Spike Holdings, LLC; and JMMAL 

Investments, LLC, 

Relief Defendants. 

Case No.: 

COMPLAINT 

 

Plaintiff Securities and Exchange Commission (“SEC”) alleges: 

SUMMARY OF THE ACTION 

1. From at least 2017 through the present, Defendant Jonathan Moynahan

Larmore (“Larmore”) has siphoned tens of millions of dollars from investment funds 

IN THE UNITED STATES DISTRICT COURT 

FOR THE DISTRICT OF ARIZONA 

Case 2:23-cv-02470-DWL Document 1 Filed 11/28/23 Page 1 of 23
COMPLAINT 2 SEC V. LARMORE ET AL.

CASE NO. XXXX

1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 

26 

27 

28 

and entities related to ArciTerra Companies, LLC (“ArciTerra”) for his personal 

enrichment and other unauthorized uses. 

2. From at least 2006 to September 2023, Defendant Larmore was the Chief 

Executive Officer (“CEO”) of ArciTerra, manager of a complex of entities involved 

with commercial real estate investment, development, and management. Beginning in 

2006, Larmore and ArciTerra raised approximately $45 million from approximately 

1045 investors for two private funds, ArciTerra Note Fund II, LLC (“Fund II”) and 

ArciTerra Note Fund III, LLC (“Fund III”) (together, the “Funds”), to which Larmore 

owed fiduciary duties as an investment adviser. 

3. But by at least January 2017, Larmore was engaged in a scheme by 

which he misappropriated millions of dollars from the Funds’ holdings by diverting it 

to Defendant ArciTerra Strategic Retail Advisors, LLC (“ASR Advisor”), an entity 

Larmore controls and owns with his mother, Relief Defendant Marcia Larmore. 

Larmore used the ASR Advisor account as his multi-million-dollar slush fund, taking 

money from the various entities he controlled—including from real estate holdings 

owned by the Funds—to pay for other cash needs of his businesses, and to fund his 

lavish lifestyle of private jets, yachts, and expensive residences. 

4. ArciTerra’s own records establish that tens of millions of dollars—none 

of which are legitimate fees, distributions, or compensation—have flowed through 

ASR Advisor to Larmore, as well as to other entities owned by Larmore and his 

family members. 

5. In or around September 2023, Larmore abdicated his direct control over 

ArciTerra by nominally resigning as its “Manager,” but retained his ability to 

influence the management and sale of ArciTerra’s assets by appointing his own agent 

as one of the two new co-managers. The two new co-managers also serve as agents for 

Larmore and his wife, respectively, in their pending divorce proceeding and serve in a 

fiduciary capacity to them. However, the co-managers do not acknowledge any 

fiduciary duty to ensure that Fund II and III assets are managed for the benefit of the 

Case 2:23-cv-02470-DWL Document 1 Filed 11/28/23 Page 2 of 23
COMPLAINT 3 SEC V. LARMORE ET AL.

CASE NO. XXXX

1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 

26 

27 

28 

Funds and their investors. 

6. After relinquishing his formal management duties for ArciTerra, Larmore 

turned to a new scheme involving stock manipulation. In November 2023, Larmore, 

using Defendant Cole Capital Funds, LLC (“Cole Capital”), an entity he had created 

just a month earlier in October 2023, engaged in transactions aimed at manipulating 

the price of the securities of WeWork, Inc., an unrelated company whose shares are 

publicly traded over the NASDAQ National Markets under the symbol “WE.” On 

November 3, 2023, Larmore sought to have disseminated through a wire service a 

press release riddled with false and misleading statements announcing a purportedly 

imminent Cole Capital tender offer for WeWork shares, a transaction that Larmore did 

not have the actual intent or ability to execute. Larmore mistimed how long it would 

take to have the press release published, and it did not go public until 5:12 p.m. EDT. 

Shortly after the press release was published, WeWork’s stock price increased by 

close to 150% in afterhours trading. 

7. Unbeknownst to the public, however, two days before dropping his press 

release, Larmore had purchased a large quantity of out-of-the-money WeWork call 

options that could have made Larmore hundreds of thousands to millions of dollars if 

the price of WeWork stock had increased significantly before they expired. Because 

he mistimed the press release, however, his options expired just over an hour before 

the WeWork stock price spiked as a result of his manipulative conduct. 

8. Defendants and Relief Defendants have each been unjustly enriched, at 

the expense of investors. The SEC brings this enforcement action to obtain emergency 

relief from the Court pending final relief, including among other things: a temporary 

restraining order and preliminary injunction enjoining Defendants from further 

violations of the securities laws; asset freezes designed to stop further 

misappropriation and dissipation of assets; an order appointing an equity receiver over 

certain Defendants, Relief Defendants, and their affiliates; and related orders. 

Case 2:23-cv-02470-DWL Document 1 Filed 11/28/23 Page 3 of 23
COMPLAINT 4 SEC V. LARMORE ET AL.

CASE NO. XXXX

1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 

26 

27 

28 

JURISDICTION AND VENUE 

9. The SEC brings this action pursuant to Sections 21(d) and 21(e) of the 

Securities Exchange Act of 1934 (“Exchange Act”) [15 U.S.C. §§ 78u(d) and 78u(e)] 

and Sections 209(d) and 209(e) of the Investment Advisers Act of 1940 (“Advisers 

Act”) [15 U.S.C. §§ 80b-9(d) and 80b-9(e)]. 

10. This Court has jurisdiction over this action pursuant to Section 27 of the 

Exchange Act [15 U.S.C. § 78aa] and Sections 209(d), 209(e), and 214 of the 

Advisers Act [15 U.S.C. §§ 80b-9(d), 80b-9(e), and 80b-14]. 

11. Defendants, directly or indirectly, made use of the means and 

instrumentalities of interstate commerce or of the mails in connection with the acts, 

transactions, practices, and courses of business alleged in this complaint. 

12. Venue is proper in this District pursuant to Section 27(a) of the Exchange 

Act [15 U.S.C. § 78aa(a)] and Section 214 of the Advisers Act [15 U.S.C. § 80b-14]. 

Acts, transactions, practices, and courses of business that form the basis for the 

violations alleged in this complaint occurred in Arizona. 

13. Under Civil Local Rule 5.1(a), this civil action is appropriate for 

assignment to the Phoenix Division, because a substantial part of the events or 

omissions which give rise to the claims alleged herein occurred in Phoenix, and in 

Maricopa County. In addition, Defendant ArciTerra’s principal place of business until 

recently was in Phoenix, Arizona. 

DEFENDANTS 

14. Defendant Jonathan Moynahan Larmore, age 50, is the co-founder 

and Chief Executive Officer (“CEO”) of Defendant ArciTerra. Larmore has 

residences in Arizona, Indiana, and Florida. Until September, Larmore fully controlled 

ArciTerra, which is owned by Relief Defendant CSL Investments, LLC; Larmore is a 

co-owner (with his wife) of CSL Investments, LLC. Through direct or indirect 

interests, Larmore also owns or controls various other ArciTerra-related entities, as 

well as numerous entities that are not related to the other entity Defendants. Larmore 

Case 2:23-cv-02470-DWL Document 1 Filed 11/28/23 Page 4 of 23
COMPLAINT 5 SEC V. LARMORE ET AL.

CASE NO. XXXX

1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 

26 

27 

28 

is an investment adviser to the Funds. 

15. Defendant ArciTerra Companies, LLC (known as ArciTerra Group, 

LLC until 2007) is an Arizona company that until approximately April 2023 had its 

principal place of business in Phoenix, Arizona, through which it conducted real estate 

investment, development, and management. It was established in 2005 by Larmore, 

who fully controlled the company until recently. According to tax documents, 

ArciTerra is owned 25% by Larmore through Relief Defendant CSL Investments, 

LLC, which he owns with his wife, Relief Defendant Michelle Larmore, who also 

owns 25% of ArciTerra, and 50% by his mother, Relief Defendant Marcia Larmore, 

through an entity she owns. In or around April 2023, ArciTerra terminated its Arizona 

operations and employees. 

16. Defendant ArciTerra Note Advisors II, LLC (“Fund II Advisors”) is 

organized under the laws of Arizona and is the investment adviser to ArciTerra Note 

Fund II, LLC. Fund II Advisors is, in turn, managed by ArciTerra. Larmore controlled 

and has an indirect ownership interest in Fund II Advisors. 

17. Defendant ArciTerra Note Advisors III, LLC (“Fund III Advisors”) is 

organized under the laws of Arizona and is the investment adviser to ArciTerra Note 

Fund III, LLC. Fund III Advisors is, in turn, managed by ArciTerra. Larmore 

controlled and has an indirect ownership interest in Fund III Advisors. 

18. Defendant ArciTerra Strategic Retail Advisor, LLC (“ASR Advisor”) 

is organized under the laws of Arizona with its principal place of business in Phoenix, 

Arizona. ASR Advisor is owned in part by Larmore and in part by his mother, Relief 

Defendant Marcia Larmore, and was until recently controlled by Larmore. ASR 

Advisor owns bank accounts that Defendants used to move cash among various 

ArciTerra entities. ASR Advisor also has invested in various commercial properties. 

19. Defendant Cole Capital Funds, LLC (“Cole Capital”) was incorporated 

by Larmore in Arizona on October 6, 2023. Its principal place of business is Phoenix, 

Arizona. Larmore is the CEO of Cole Capital. 

Case 2:23-cv-02470-DWL Document 1 Filed 11/28/23 Page 5 of 23
COMPLAINT 6 SEC V. LARMORE ET AL.

CASE NO. XXXX

1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 

26 

27 

28 

20. Fund II Advisors, Fund III Advisors, and ASR Advisor have each agreed 

to and executed tolling agreements with the SEC for the time period October 17, 2023 

through January 17, 2024. 

RELIEF DEFENDANTS 

21. Relief Defendant Michelle Ann Larmore, age 50, is currently married 

to Larmore and a resident of Phoenix, Arizona. She is identified in corporate and tax 

records as owner or part owner of various ArciTerra-related entities, including as coowner with Larmore of Relief Defendant CSL Investments, LLC, which has 

ownership in ArciTerra. Michelle Larmore filed legal separation proceedings against 

Jonathan Larmore in March 2023 in Phoenix, Arizona, which are ongoing and referred 

to below as “divorce proceedings.” 

22. Relief Defendant Marcia Moynahan Larmore, age 77, is the mother of 

Larmore and a resident of Arizona and Indiana, and she is identified in corporate 

records as holding senior positions at various ArciTerra-related entities, including as 

manager, president, and principal of an entity, Moynahan Investments, LLC, which 

has ownership in ArciTerra. 

23. Relief Defendant CSL Investments, LLC (“CSL Investments”) is 

incorporated in Arizona with its principal place of business in Indiana. CSL 

Investments is controlled by Larmore and owned by Larmore and his wife. CSL 

Investments has a 50% ownership interest in ArciTerra. 

24. Relief Defendant MML Investments, LLC (“MML Investments”) is 

incorporated in Arizona, and is wholly owned and controlled by Relief Defendant 

Marcia Larmore. 

25. Relief Defendant JMMAL Investments, LLC (“JMMAL 

Investments”) is incorporated and headquartered in Arizona, and is wholly or partly 

owned, and wholly controlled, by Larmore. 

26. Relief Defendant Spike Holdings, LLC (“Spike Holdings”) is 

incorporated and headquartered in Arizona, and is wholly owned and controlled by 

Case 2:23-cv-02470-DWL Document 1 Filed 11/28/23 Page 6 of 23
COMPLAINT 7 SEC V. LARMORE ET AL.

CASE NO. XXXX

1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 

26 

27 

28 

Defendant Jonathan Larmore. 

FACTUAL ALLEGATIONS 

27. Since its inception in 2005, ArciTerra has served as the manager for three 

ArciTerra real estate investment funds, multiple ArciTerra real estate investment trusts 

(REITs), and a number of limited liability companies, including some with outside 

investors, that own one or more commercial properties. 

28. In October 2006, Larmore formed ArciTerra Note Fund II, LLC (referred 

to throughout this complaint as “Fund II”). Larmore designated Defendant Fund II 

Advisors the sole member of, and “advisor” to, Fund II. Fund II Advisors is in turn 

managed by ArciTerra, and is compensated through fees for its management of Fund 

II and its assets. Defendant Fund II Advisors is an investment adviser. 

29. Under the Advisers Act, an investment adviser is a person who, for 

compensation, engages in the business of providing investment advice to others, 

including a private fund, about investing in securities. Advisers that manage portfolios 

for funds provide ongoing advice about buying, selling, and holding investments and, 

in an ongoing advisory relationship, monitor the investments and their alignment with 

the investment objectives and best interests of their fund clients. Investment advisers 

are fiduciaries to their clients, including fund clients. 

30. Larmore, who controls Defendants ArciTerra and Fund II Advisors, and 

is compensated for this role, also acts or has acted as an investment adviser to Fund II. 

31. In 2006 and 2007, Fund II raised a total of approximately $20 million 

from approximately 466 investors by issuing secured notes that bear an interest rate of 

8.25% per annum. Fund II used $20 million in proceeds of the offering of secured 

notes to purchase, directly or through wholly owned intermediaries, various realestate-related assets, including (i) limited partnership interests in ArciTerra National 

REIT LP (“National REIT”), (ii) limited partnership interests in ATG REIT RSC, LP 

(“ATG REIT”), (iii) LLC interests in Glen Rosa 32, LLC (“Glen Rosa”), holding 

company of a nursing-home property in Phoenix, Arizona, and (iv) LLC interests in 

Case 2:23-cv-02470-DWL Document 1 Filed 11/28/23 Page 7 of 23
COMPLAINT 8 SEC V. LARMORE ET AL.

CASE NO. XXXX

1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 

26 

27 

28 

ArciTerra Vermont, which holds a commercial property in Indianapolis, Indiana. 

Some of these interests, including the limited partnership interests in National REIT, 

are securities. 

32. In February 2008, Larmore formed ArciTerra Note Fund III, LLC (“Fund 

III”) and designated Fund III Advisors as the sole member of, and “advisor” to, Fund 

III. Fund III Advisors, like Fund II Advisors, is also managed by ArciTerra, is an 

investment adviser to Fund III, and is similarly compensated through fees for its 

management. 

33. Larmore, who controls Defendants ArciTerra and Fund III Advisors, and 

is compensated for this role, also acts or has acted as an investment adviser to Fund 

III. 

34. In 2008 and 2009, Fund III raised approximately $25 million from 

approximately 579 investors by issuing secured notes that bear an interest rate of 

9.25% per annum. Fund III used proceeds of the $25 million note offering to 

purchase, directly or through wholly owned intermediaries, various real-estate-related 

assets, including (i) limited partnership interests in National REIT, (ii) limited 

partnership shares in ATG REIT, (iii) LLC interests in Glen Rosa, and (iv) preferred 

stock in a real-estate enterprise managed by a third party held through a wholly owned 

entity called ArciTerra NS Investment Co. (“ArciTerra NS”). Some of these interests, 

including the limited partnership interests in National REIT and preferred stock held 

via ArciTerra NS, are securities. 

35. Fund II and Fund III are distinct investment vehicles, with different 

investors from each other and from other ArciTerra-related entities. They also have 

their own, distinct investment holdings and expected revenues based on their 

underlying investments. 

Larmore Misappropriates Money from the Funds’ Assets 

36. Beginning no later than January 1, 2017, through at least June 2023 (the 

most recent period for which records are available), Defendants Larmore, ArciTerra, 

Case 2:23-cv-02470-DWL Document 1 Filed 11/28/23 Page 8 of 23
COMPLAINT 9 SEC V. LARMORE ET AL.

CASE NO. XXXX

1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 

26 

27 

28 

Fund II Advisors, Fund III Advisors, and ASR Advisor commingled cash transferred 

from Fund II and Fund III assets with other cash in bank accounts owned by other 

ArciTerra entities, without regard for the fund or investor pool to which the cash 

belonged. 

37. During this same time period, Larmore misappropriated at least $17 

million from those commingled assets through payments to himself or entities he or 

his family own, including to pay for his family’s personal credit card bills. 

38. Larmore diverted money from the Funds by taking advantage of his 

control over ArciTerra and its related entities. He directed ArciTerra’s personnel to 

transfer a total of at least $35 million, via various intermediary entities, from bank 

accounts associated with holdings of the Funds (“Fund Holding Accounts”) to the 

account in the name of Defendant ASR Advisor (which is owned by Larmore and his 

mother, Relief Defendant Marcia Larmore). 

39. In particular, during this time period, Larmore directed ArciTerra 

personnel to transfer a total of approximately $12.5 million from Glen Rosa, and 

approximately $22.5 million from ATG REIT, to Defendant ASR Advisor. Funds II 

and III jointly own both Glen Rosa and ATG REIT. 

40. During this time period, at Larmore’s direction, ArciTerra staff routinely 

transferred cash from Fund Holding Accounts, and accounts owned by or associated 

with other ArciTerra investment vehicles, into ASR Advisor’s account. They did so to 

facilitate cash needs, on an ad hoc basis, of any ArciTerra investment vehicles without 

regard to any relationship between the source of the cash used and the intended 

beneficiary of the cash used, as well as to pay Larmore’s personal expenses. These 

cash transfers were not legitimate fees, distributions, or compensation to Larmore or 

entities owned by Larmore and his family. The amounts taken from Glen Rosa and 

ATG REIT were commingled with other money in ASR Advisor’s account and 

misused in this manner. 

41. ArciTerra personnel recorded these cash transfers in ArciTerra’s 

Case 2:23-cv-02470-DWL Document 1 Filed 11/28/23 Page 9 of 23
COMPLAINT 10 SEC V. LARMORE ET AL.

CASE NO. XXXX

1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 

26 

27 

28 

accounting records, and indicated in those records which entities or accounts the 

resulting debts were “due from” and “due to.” 

42. Fund II and Fund III’s use of proceeds disclosures to investors did not 

permit Larmore, ArciTerra, or the Fund Advisors to transfer cash out of the Fund 

Holding Accounts without creating formal evidence of an actual loan, or other 

substantiated debt, and without identifying the enforceable repayment terms, security 

interests, interest payments, or other terms that would evidence an economic benefit to 

the Funds. The Funds’ written disclosures certainly did not authorize Larmore to use 

its monies for his personal expenses, and as a fiduciary to the Funds such use would 

not have been permissible. 

43. Among the many inappropriate diversions of cash to Larmore’s personal 

use were transfers made to pay for his wife’s (Relief Defendant Michelle Larmore) 

and his children’s personal credit card bills. Larmore essentially treated the ASR 

Advisor bank account as his own personal bank account to fund his lavish lifestyle of 

private jets, yachts, high-end cars, and expensive residences. ArciTerra’s staff 

recorded the payments for Larmore’s personal expenses as “due from” his personal 

account and the account of his personal entity, JMMAL Investments. 

44. As of December 31, 2022, Larmore had diverted over $17 million from 

ArciTerra entities, through ASR Advisor, to his personal account and the account of 

JMMAL Investments. Larmore has not repaid these cash transfers. 

45. Larmore has depleted ASR Advisor’s account, making it impossible for 

ASR Advisor to return the millions of dollars “due to” the Fund Holding Accounts. As 

of June 30, 2023, ArciTerra’s books reflected cash transfers to ASR Advisor totaling 

approximately $53 million from various ArciTerra-related entities and investment 

vehicles (some owned by other outside investors). This amount includes 

approximately $35 million that was transferred out of the Fund Holding Accounts and 

which ArciTerra describes as “due from” ASR Advisor to accounts associated with 

Fund II and Fund III assets. 

Case 2:23-cv-02470-DWL Document 1 Filed 11/28/23 Page 10 of 23
COMPLAINT 11 SEC V. LARMORE ET AL.

CASE NO. XXXX

1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 

26 

27 

28 

46. Amounts in the ASR Advisor account that were not ultimately transferred 

to Larmore and his family were utilized for the cash needs of various ArciTerraaffiliated entities, without regard to whether the cash was taken from holdings owned 

by entities with outside investors. 

47. Ultimately, nearly all cash transferred to ASR Advisor has been 

dissipated. As of October 4, 2023, according to ArciTerra, ASR Advisor had less than 

$500 remaining in its bank account. 

Larmore Leaves ArciTerra and the Funds in Turmoil 

48. From 2019 to the present, most of the ArciTerra-related investment 

vehicles and entities had ceased making payments to investors. Furthermore, the cash 

transfers at times deprived the companies in which Fund II and Fund III had invested 

that own real properties of the ability to sustain normal operations, which negatively 

impacted the value of the properties themselves by depriving them of money needed 

for repairs and maintenance. 

49. During the past year, Larmore has become increasingly volatile, and his 

actions suggest that he is desperate for cash. In April 2023, Larmore fired all 

ArciTerra employees in Phoenix, and he shuttered ArciTerra’s office, leaving few or 

no employees to conduct ArciTerra’s business. 

50. In April 2023, Larmore sent an email to a large group of people, with the 

subject line: “The Perfect Storm Sale.” In the email, Larmore stated that he wished to 

sell off all the assets in ArciTerra’s portfolio, as well as everything he personally 

owned, including his family’s homes, cars, boats, artwork, and jewelry, in seventyfive days. The ArciTerra portfolio assets would include holdings and real property 

held by Fund II and Fund III, as well as assets held by other ArciTerra-related 

investment vehicles. Larmore stated that he wished “to shed the baggage of my past 

and start fresh” and that he needed to liquidate all of his business and personal assets 

to “finish dividing assets with my wife” who had filed a divorce proceeding the 

previous month. 

Case 2:23-cv-02470-DWL Document 1 Filed 11/28/23 Page 11 of 23
COMPLAINT 12 SEC V. LARMORE ET AL.

CASE NO. XXXX

1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 

26 

27 

28 

51. In July 2023, Larmore agreed on behalf of ArciTerra to hire a consultant 

(the “Consultant”) who was tasked with liquidating all ArciTerra-related assets as 

quickly as possible. The Consultant’s scope of duties includes selling all assets held 

by Fund II, Fund III, and other ArciTerra investment vehicles. 

52. In August 2023, under the terms of an agreement filed in the Larmore’s 

Arizona divorce proceeding, Larmore selected the Consultant, and Michelle Larmore 

selected ArciTerra’s former Chief Operating Officer (“former COO”), to act as their 

respective agents in the disposition of ArciTerra assets for purposes of division of the 

marital estate. However, Larmore and his wife may continue to advise their agents on 

the management of all properties and accounts. 

53. In September 2023, Larmore formally resigned from his management 

role at ArciTerra, and the Consultant and the former COO were appointed to serve as 

co-managers. They are each paid a commission for the sale of any real properties, and 

are additionally paid a flat fee of $50,000 a month and a $100,000 quarterly bonus. 

Their compensation provides them with additional incentive to pursue the interests of 

the people who appointed them, Larmore and his wife, and not the interests of the 

Funds. 

54. Neither co-manager acknowledges a role as investment adviser or 

fiduciary to the Funds or any other ArciTerra investment vehicles with outside 

investors. Their sole purpose appears to be to liquidate assets, including Fund II and 

Fund III assets, to benefit Larmore and his wife. Larmore’s abandonment of 

ArciTerra, his actions to liquidate assets, and his failure to put in place an investment 

adviser or fiduciary to the Funds are violations of his fiduciary duties. 

Larmore Manipulates WeWork Stock

55. In early October 2023, after relinquishing direct access to ArciTerra’s 

coffers, and aware he was being investigated by SEC staff, Larmore formed 

Defendant Cole Capital in the State of Arizona. Larmore listed with the Arizona 

Secretary of State the address of Cole Capital as a shared office space area hosted by 

Case 2:23-cv-02470-DWL Document 1 Filed 11/28/23 Page 12 of 23
COMPLAINT 13 SEC V. LARMORE ET AL.

CASE NO. XXXX

1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 

26 

27 

28 

the firm WeWork, in Phoenix, Arizona. Also at that time, Larmore launched a website 

for Cole Capital, where Larmore (omitting his first name, as Moynahan Larmore) was 

listed as the CEO. 

56. On or about November 1 and November 2, 2023, Larmore purchased a 

total of 72,846 call option contracts on the common stock of the publicly-traded 

company WeWork, the common stock of which is sold under the ticker symbol “WE” 

on the NASDAQ National Market, for $0.03 to $0.15 per contract. Call options give 

the purchaser the right, but not the obligation, to buy the underlying security for the 

price stated in the option (the “strike price”) on or before the expiration date identified 

in the option; the call option contracts in question would have given Larmore the right 

to acquire 7,284,600 shares of WeWork common stock before they expired. Also on 

November 1 and November 2, Larmore bought 343,641 shares of WeWork stock. 

57. Larmore purchased very short-term call options. The expiration date for 

the vast majority of the WeWork call options was November 3, 2023, at 4:00 p.m. 

EDT. A smaller portion had an expiration date of November 10, 2023, at 4:00 p.m. 

EDT. 

58. Larmore’s options were also significantly “out-of-the-money.” Call 

options are considered “out-of-the-money” when the strike price of the option is 

higher than the current trading price of the underlying security. For instance, 

WeWork’s common stock closed on November 2, 2023 at a price of $1.15 per share, 

and at the close of the following day, November 3, 2023, the price was $0.84 per 

share. In contrast, the strike prices for the WeWork call options Larmore purchased 

ranged from $2 to $5. Having purchased the out-of-the money call options for pennies 

per contract, Larmore stood to make substantial gains if the stock price rose above the 

strike price of some or all of the options. 

59. On the morning of November 3, 2023, Larmore sent an email to an SEC 

mailbox from an email address at the Cole Capital website. The email attached a 

document that Larmore was seeking to file publicly with the SEC, identified as a 

Case 2:23-cv-02470-DWL Document 1 Filed 11/28/23 Page 13 of 23
COMPLAINT 14 SEC V. LARMORE ET AL.

CASE NO. XXXX

1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 

26 

27 

28 

“Schedule TO.” A Schedule TO is a filing required to be made with the SEC by a 

person who intends to make a “tender offer” for securities registered under the 

Securities Exchange Act of 1934. A tender offer is a proposal by a person to buy all 

(or most) of the shares of a publicly traded company for a stated price by a specified 

date. 

60. In the document identified as a Schedule TO, attached to the email to the 

SEC from the Cole Capital address, Larmore included the text of a letter that Larmore 

indicated he had sent to WeWork’s CEO and its Board of Directors that morning, 

which stated, in part: 

We believe that it is in the best interest of WeWork to support our acquisition of 51% of all the outstanding shares owned by minority shareholders at a price of $9.00 per share and provide Cole with proper representation on the company board. 

We have received feedback from City National Bank and JP Morgan regarding the financing for this acquisition and expect to select a lender and have a financing commitment prior to execution of a definitive agreement. 

We have consulted with God, legal, financial and other advisors to assist us 

with this transaction. We stand ready to proceed timely. 

61. The $9.00 per share price contained in the letter represented a premium 

of more than $7.89 over WeWork’s closing price of $1.11 per share on November 2, 

2023. 

62. On November 3, at 5:12 p.m. EDT, a Cole Capital press release was 

disseminated through a wire service and picked up by several media sites. Larmore 

arranged to send out the release through the wire service, and he paid for its 

publication. Larmore had submitted the release to the service well before the close of 

trading hours that day, but the service had rejected it at least once for formatting issues 

or other irregularities. 

63. The release was titled “A Proposal by Cole Capital Funds Seeks to 

Acquire 51% of all minority ownership shares of WeWork, Inc. for $9.00 per share in 

Cash.” The press release further stated that Cole Capital had sent a letter to the 

WeWork Board of Directors, reiterating the same statement quoted above from the 

Case 2:23-cv-02470-DWL Document 1 Filed 11/28/23 Page 14 of 23
COMPLAINT 15 SEC V. LARMORE ET AL.

CASE NO. XXXX

1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 

26 

27 

28 

Schedule TO attached to Larmore’s email to the SEC. 

64. Although at the close of market trading (4:00 p.m. EDT) on November 3, 

2023, WeWork’s stock price closed at $0.83 per share, immediately after the press 

release was published, the share price of WeWork jumped in afterhours trading to 

$1.45 per share, and reached a high that evening of $2.14 per share, at 6:31 p.m. EDT. 

Most websites that had posted the press release removed it by the next morning. The 

stock price closed at $1.18 at the end of afterhours trading. 

65. Larmore did not exercise his November 3 call options because they had 

expired before the press release was published, and he did not exercise his November 

10 call options because the stock price did not exceed the strike price. Indeed, on 

Monday, November 6, 2023, WeWork filed for Chapter 11 bankruptcy protection. 

66. Larmore’s press release did not reflect a bona fide offer for WeWork 

stock. Larmore and Cole Capital did not have sufficient liquid capital to execute Cole 

Capital’s proposed tender offer. Additionally, Larmore and Cole Capital did not have, 

and did not have any reasonable prospects for securing, the financing required for 

such a tender offer. Rather, Larmore’s apparent purpose in the scheme was simply to 

manipulate WeWork’s stock price, in an attempt to profit from the change in price by 

trading in WeWork options. 

Relief Defendants 

67. Relief Defendants CSL Investments, MML Investments, and JMMAL 

Investments received money from other ArciTerra-related entities, to which they were 

not entitled and had no legitimate claim. Those funds were commingled with money 

from other ArciTerra-related entities, and then paid from the ASR Advisor bank 

account to Relief Defendants CSL Investments, MML Investments, and JMMAL 

Investments. ArciTerra’s accounting records show that, as of December 31, 2022, 

almost $9.8 million is “due from” CSL Investments to ASR Advisor, almost $4.9 

million is “due from” MML Investments to ASR Advisor, and over $11.5 million is 

“due from” JMMAL Investments to ASR Advisor. 

Case 2:23-cv-02470-DWL Document 1 Filed 11/28/23 Page 15 of 23
COMPLAINT 16 SEC V. LARMORE ET AL.

CASE NO. XXXX

1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 

26 

27 

28 

68. Relief Defendant Spike Holdings also received money from other 

ArciTerra-related entities to which it is not entitled and for which it has no legitimate 

claim, including direct transfers from a property-holding entity belonging to Fund II 

and Fund III. 

69. Relief Defendant Michelle Larmore received money to which she was 

not entitled and over which she has no legitimate claim. Michelle Larmore received 

some such money through ArciTerra’s payment of her personal expenses such as 

credit card bills, as well as through her partial ownership of CSL Investments. 

70. Relief Defendant Marcia Larmore received money to which she was not 

entitled and over which she has no legitimate claim. Marcia Larmore received some 

such money through her ownership of MML Investments and partial ownership of 

other ArciTerra-related entities. 

FIRST CLAIM FOR RELIEF 

Violations of Sections 206(1) and 206(2) of the Advisers Act by Defendants 

Larmore, Fund II Advisors, and Fund III Advisors 

71. The SEC realleges and incorporates by reference the above paragraphs 1 

through 70. 

72. Defendants Larmore, Fund II Advisors, and Fund III Advisors are 

investment advisers as defined by Section 202(a)(11) of the Advisers Act [15 U.S.C. § 

80b-2(a)(11)]. 

73. By engaging in the conduct described above, Defendants Larmore, Fund 

II Advisors, and Fund III Advisors, while acting as investment advisers, directly or 

indirectly, by use of the mails or means and instrumentalities of interstate commerce: 

(a) acting with scienter, employed or are employing devices, schemes or artifices to 

defraud clients or prospective clients; and (b) negligently or knowingly engaged in or 

are engaging in transactions, practices, or courses of business which operated as a 

fraud or deceit upon clients or prospective clients. 

74. By reason of the foregoing, Defendants Larmore, Fund II Advisors, and 

Case 2:23-cv-02470-DWL Document 1 Filed 11/28/23 Page 16 of 23
COMPLAINT 17 SEC V. LARMORE ET AL.

CASE NO. XXXX

1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 

26 

27 

28 

Fund III Advisors violated, and unless restrained and enjoined, will continue to 

violate, Sections 206(1) and 206(2) of the Advisers Act [15 U.S.C. §§ 80b-6(1) and 

80b-6(2)]. 

SECOND CLAIM FOR RELIEF 

Aiding and Abetting Violations of Sections 206(1) and 206(2) 

of the Advisers Act by Defendant Larmore 

75. The SEC realleges and incorporates by reference the above paragraphs 1 

through 70. 

76. Defendants Fund II Advisors and Fund III Advisors violated Sections 

206(1) and (2) of the Advisers Act [15 U.S.C. § 80b-6(1) and (2)]. 

77. By engaging in the conduct described above, Defendant Larmore aided 

and abetted Fund II Advisors’ and Fund III Advisors’ violations of Sections 206(1) 

and (2) of the Advisers Act by knowingly or recklessly providing substantial 

assistance to Defendants Fund II Advisors and Fund III Advisors, who, while acting 

as investment advisers, directly or indirectly, by the use of the mails or any means or 

instrumentality of interstate commerce, (a) acting with scienter, employed or are 

employing devices, schemes or artifices to defraud clients or prospective clients; and 

(b) negligently or knowingly engaged in or are engaging in transactions, practices, or 

courses of business which operated as a fraud or deceit upon clients or prospective 

clients. 

78. By reason of the foregoing, Defendant Larmore, directly or indirectly, 

aided and abetted and is liable for violations of, and unless restrained and enjoined, 

will continue to violate, Sections 206(1) and (2) of the Advisers Act [15 U.S.C. § 80b6(1) and (2)]. 

THIRD CLAIM FOR RELIEF 

Aiding and Abetting Violations of Sections 206(1) and 206(2) 

of the Advisers Act by Defendants ArciTerra and ASR Advisor 

79. The SEC realleges and incorporates by reference the above paragraphs 1 

Case 2:23-cv-02470-DWL Document 1 Filed 11/28/23 Page 17 of 23
COMPLAINT 18 SEC V. LARMORE ET AL.

CASE NO. XXXX

1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 

26 

27 

28 

through 70. 

80. Defendants Larmore, Fund II Advisors, Fund III Advisors violated 

Sections 206(1) and (2) of the Advisers Act [15 U.S.C. § 80b-6(1) and (2)]. 

81. By engaging in the conduct described above, Defendants ArciTerra and 

ASR Advisor aided and abetted Larmore’s, Fund II Advisors’, and Fund III Advisors’ 

violations of Sections 206(1) and (2) of the Advisers Act by knowingly or recklessly 

providing substantial assistance to Defendants Larmore, Fund II Advisors, and Fund 

III Advisors, who, while acting as investment advisers, directly or indirectly, by the 

use of the mails or any means or instrumentality of interstate commerce, (a) acting 

with scienter, employed or are employing devices, schemes or artifices to defraud 

clients or prospective clients; and (b) negligently or knowingly engaged in or are 

engaging in transactions, practices, or courses of business which operated as a fraud or 

deceit upon clients or prospective clients. 

82. By reason of the foregoing, Defendants ArciTerra and ASR Advisor, 

directly or indirectly, aided and abetted and are liable for violations of, and unless 

restrained and enjoined, will continue to violate, Sections 206(1) and (2) of the 

Advisers Act [15 U.S.C. § 80b-6(1) and (2)]. 

FOURTH CLAIM FOR RELIEF 

Violations of Section 10(b) of the Exchange Act and Rule 10b-5 Thereunder by 

Defendants Larmore and Cole Capital 

83. The SEC realleges and incorporates by reference the above paragraphs 1 

through 70. 

84. By engaging in the conduct described above, Defendants Larmore and 

Cole Capital each, directly or indirectly, in connection with the purchase or sale of 

securities, by the use of means or instrumentalities of interstate commerce, or the 

mails, with scienter: 

(a) Employed devices, schemes, or artifices to defraud; 

(b) Made untrue statements of material fact or omitted to state material 

Case 2:23-cv-02470-DWL Document 1 Filed 11/28/23 Page 18 of 23
COMPLAINT 19 SEC V. LARMORE ET AL.

CASE NO. XXXX

1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 

26 

27 

28 

facts necessary in order to make the statements made, in the light 

of the circumstances under which they were made, not misleading; 

and 

(c) Engaged in acts, practices, or courses of business which operated 

or would operate as a fraud or deceit upon other persons, including 

purchasers and sellers of securities. 

85. By reason of the foregoing, Defendants Larmore and Cole Capital 

violated, and unless restrained and enjoined will continue to violate, Section 10(b) of 

the Exchange Act [15 U.S.C. § 78j(b)] and Rule 10b-5 thereunder [17 C.F.R. 

§ 240.10b-5]. 

FIFTH CLAIM FOR RELIEF 

Violations of Section 14(e) of the Exchange Act and Rule 14e-8 Thereunder by 

Defendants Larmore and Cole Capital 

86. The SEC realleges and incorporates by reference the above paragraphs 1 

through 70. 

87. By engaging in the conduct described above, Defendants Larmore and 

Cole Capital (1) each made untrue statements of a material fact and each omitted to 

state material facts necessary in order to make the statements made, in the light of the 

circumstances under which they were made, not misleading; and (2) each engaged in 

fraudulent, deceptive, or manipulative acts or practices, in connection with a tender 

offer. 

88. By engaging in the conduct described above, Defendants Larmore and 

Cole Capital, in connection with a tender offer, engaged in fraudulent, deceptive, or 

manipulative acts or practices, by publicly announcing that Cole Capital planned to 

make a tender offer that has not yet been commenced, where Defendants Larmore and 

Cole Capital (a) made the announcement of a potential tender offer without the 

intention to commence the offer within a reasonable time and complete the offer; (b) 

intended, directly or indirectly, for the announcement to manipulate the market price 

Case 2:23-cv-02470-DWL Document 1 Filed 11/28/23 Page 19 of 23
COMPLAINT 20 SEC V. LARMORE ET AL.

CASE NO. XXXX

1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 

26 

27 

28 

of the stock of the bidder or subject company; and (c) did not have the reasonable 

belief that Cole Capital would have the means to purchase securities to complete the 

offer.

89. By reason of the foregoing, Defendants Larmore and Cole Capital 

violated, and unless restrained and enjoined will continue to violate, Section 14(e) of 

the Exchange Act [15 U.S.C. § 78n(e)] and Rule 14e-8 [17 C.F.R. § 240.14e-8] 

promulgated thereunder. 

PRAYER FOR RELIEF 

WHEREFORE, the SEC respectfully requests that this Court grant the 

following relief: 

I. 

An order temporarily and preliminarily, through final judgments, restraining 

and enjoining Defendants Larmore, Fund II Advisors, Fund III Advisors, ArciTerra 

and ASR Advisor from directly or indirectly violating Sections 206(1) and (2) of the 

Advisers Act [15 U.S.C. § 80b-6(1) and (2)]; and temporarily and preliminarily, 

through final judgments, restraining and enjoining Larmore and Cole Capital from 

directly or indirectly violating Sections 10(b) and 14(e) of the Exchange Act 

[15 U.S.C. § 78j(b) and 78n(e)] and Rules 10b-5 and 14e-8 [17 C.F.R. §§ 240.10b-5 

and 240.14e-8]. 

II. 

An order temporarily and preliminarily, through final judgments, appointing a 

receiver over Defendants Fund II Advisors, Fund III Advisors, ArciTerra, ASR 

Advisor, and Relief Defendants CSL Investments, MML Investments, Spike 

Holdings, and JMMAL Investments (collectively, “Receivership Entities”), and any 

known or unknown affiliates of the Receivership Entities. 

III. 

An order temporarily and preliminarily, through final judgments, staying all 

pending cases and enjoining the filing of any new bankruptcy, foreclosure, or 

Case 2:23-cv-02470-DWL Document 1 Filed 11/28/23 Page 20 of 23
COMPLAINT 21 SEC V. LARMORE ET AL.

CASE NO. XXXX

1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 

26 

27 

28 

receivership actions by or against ArciTerra or any other Receivership Entity or any 

receivership assets, wherever located. 

IV. 

An order temporarily and preliminarily, through final judgments, freezing the 

assets of Defendants Larmore, Fund II Advisors, Fund III Advisors, ArciTerra, ASR 

Advisor, Cole Capital, and Relief Defendants CSL Investments, MML Investments, 

Spike Holdings, JMMAL Investments, and their known or unknown affiliates. 

V. 

An order temporarily and preliminarily, through final judgments, prohibiting 

the Defendants and Relief Defendants from the acceptance, deposit, or disbursement 

of additional fund monies or investor funds, or causing any assets or funds of the 

Defendants or Relief Defendants to be withdrawn, transferred, pledged, or 

encumbered. 

VI. 

An order requiring a verified accounting of assets by Defendants Larmore, 

Fund II Advisors, Fund III Advisors, ArciTerra, ASR Advisor, Cole Capital, and 

Relief Defendants Michelle Larmore, Marcia Larmore, CSL Investments, MML 

Investments, Spike Holdings, JMMAL Investments, and their known and unknown 

affiliates. 

VII. 

An order temporarily and preliminarily, through the Court’s decision on the 

SEC’s application for a preliminary injunction, permitting expedited discovery. 

VIII. 

An order temporarily, and preliminarily through final judgments, restraining 

and enjoining Defendants, Relief Defendants, and any person or entity acting at their 

direction or on their behalf, from destroying, altering, concealing, or otherwise 

interfering with the access of the SEC to relevant documents, books, and records. 

Case 2:23-cv-02470-DWL Document 1 Filed 11/28/23 Page 21 of 23
COMPLAINT 22 SEC V. LARMORE ET AL.

CASE NO. XXXX

1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 

26 

27 

28 

IX. 

Final Judgments permanently restraining and enjoining Defendants Larmore, 

Fund II Advisors, Fund III Advisors, ArciTerra and ASR Advisor from directly or 

indirectly violating Sections 206(1) and (2) of the Advisers Act [15 U.S.C. § 80b-6(1) 

and (2)]; and permanently restraining and enjoining Larmore and Cole Capital from 

directly or indirectly violating Sections 10(b) and 14(e) of the Exchange Act 

[15 U.S.C. § 78j(b) and 78n(e)] and Rules 10b-5 and 14e-8 [17 C.F.R. §§ 240.10b-5 

and 240.14e-8]. 

X. 

Final judgments requiring each of the Defendants and Relief Defendants to 

disgorge the ill-gotten gains or unjust enrichment each of them obtained or derived 

from such violations, and an order requiring each of the Defendants to pay a civil 

monetary penalty pursuant to Section 21(d) of the Exchange Act [15 U.S.C. 

§ 78u(d)(3)] and Section 209(e) of the Advisers Act [15 U.S.C. § 80b-9(e)]. 

XI. 

 Final judgments, pursuant to Section 21(d)(2) of the Exchange Act [15 U.S.C. 

§ 78u(d)(2)], prohibiting Defendant Larmore from serving as an officer or director of 

any entity having a class of securities registered with the SEC pursuant to Section 12 

of the Exchange Act [15 U.S.C. § 78l] or that is required to file reports pursuant to 

Section 15(d) of the Exchange Act [15 U.S.C. §78o(d)]. 

XII. 

That the Court retain jurisdiction of this action in accordance with the principles 

of equity and the Federal Rules of Civil Procedure in order to implement and carry out 

the terms of all orders and decrees that may be entered, or to entertain any suitable 

application or motion for additional relief within the jurisdiction of this Court. 

Case 2:23-cv-02470-DWL Document 1 Filed 11/28/23 Page 22 of 23
COMPLAINT 23 SEC V. LARMORE ET AL.

CASE NO. XXXX

1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 

26 

27 

28 

XIII. 

That the Court grant such other and further relief as this Court may determine to 

be just and necessary. 

Dated: November 28, 2023 Respectfully submitted, 

 

/s/ John K. Han 

John K. Han 

Heather E. Marlow 

Amanda L. Straub 

Attorneys for Plaintiff 

SECURITIES AND EXCHANGE 

COMMISSION 

Case 2:23-cv-02470-DWL Document 1 Filed 11/28/23 Page 23 of 23