Fraud concerns are growing in connection with the Nightingale investment firm’s handling of investor funds. We just reported on the disappearance of millions of dollars raised on the CrowdStreet platform for two Nightingale deals. And now, CrowdStreet is worried about the management of a Nightingale office tower in Chicago, which was also partially paid for by CrowdStreet investors.   Hi, I'm Kathy Fettke and this is Real Estate News for Investors. If you like our podcast, please subscribe and leave us a review.   In a previous podcast, we reported that Nightingale is accused of misappropriating more than $50 million that investors pumped into two high-end properties in Atlanta and Chicago. The deals never closed, and when the money went missing, CrowdStreet recommended the appointment of an independent manager. Shareholders agreed and hired Anna Phillips. She then placed the entities created for those deals into bankruptcy to help track down the money.   CrowdStreet Reviewing Nightingale Campaigns   Now CrowdStreet is taking a closer look at the Nightingale campaigns and wants to put Phillips in control of the Chicago property. That’s after a request for audited financial records went unanswered.   But in this case, putting an independent manager in charge is more complicated because the Chicago office tower is an operating asset with equity investors who are not connected to CrowdStreet. There’s also an ownership transfer to deal with and several loans.   Nightingale acquired the building in February of last year for $130 million. $25 million came from CrowdStreet investors. The rest came from other sources, including an $86 million mortgage from Citibank. CrowdStreet sponsors, like Nightingale, are expected to provide investor updates on a quarterly basis along with other information such as performance and distribution reports and annual tax documents.    In the first quarter report, which was reviewed by Bisnow, the entity’s name was changed from Nightingale Realty LLC to Nite Sky Realty LLC. It reported that the building was about 91% occupied and aligned with the business plan but that the distribution couldn’t be paid because three tenants were late on their rent. There was an apology for the delay, and a promise to provide a distribution date in the near future. It also said the building had about $10 million in reserves but there hasn’t been another update since the mid-May report.   Issues Piling Up for Nightingale   One investor told Bisnow: “Where’s that money? Is it still there?” CrowdStreet has told investors that it has hired a forensic accountant to review financial records that it received previously, around the time of the funding, and is talking to lawyers about how investors can wrestle control away from Nightingale. Although there’s no evidence of fraud as yet, the issues are piling up for Nightingale.    Bisnow reports that Nightingale faces a growing number of lawsuits and debt defaults. It says that Nightingale lost a 2.2 million square foot property in Philadelphia to receivership, that Nightingale is facing foreclosure lawsuits for commercial buildings in Manhattan and Brooklyn, and that it is sitting on one of the biggest vacant office buildings in New York City.   In the meantime, CrowdStreet is reassuring investors that it remains confident in its vetting process, and that escrow is now a requirement for deals that haven’t closed. Ultimately, responsibility for due diligence lies with the investor. As I mentioned in a previous podcast, this is one reason that only accredited investors are allowed to invest in these kinds of deals – so they can afford to have legal and financial professionals review the documents. It’s important that the deal is understood by the investor or someone on the investor’s team.   This is why I've decided to create a master course on development, that will be helpful for both investors and developers. So many syndications require development of some kind, and it's import