Federal lawsuit accuses Tiburon man of $75 million investor scheme

A group of California investment funds has sued Tiburon resident Mark Hanf and nine of his affiliated companies in federal court, accusing him of running a yearslong scheme to siphon more than $75 million from investors into his own network of companies rather than deploying it as promised.

The lawsuit, filed April 8 in U.S. District Court in San Francisco, brings 10 counts against Hanf, his former chief operating officer, Nam Phan, and the nine corporate entities. Its most serious charge invokes the federal Racketeer Influenced and Corrupt Organizations Act — the statute more commonly associated with organized crime prosecutions — and alleges that the defendants constructed an “enterprise” designed to collect investor money and funnel it to themselves.

The suit adds a federal civil dimension to deepening legal and regulatory scrutiny of Hanf and his shuttered Novato-based real-estate lending firm, Pacific Private Money, that includes a Marin County District Attorney’s Office investigation; calls from U.S. Rep. Jared Huffman, D-San Rafael, for the FBI and Securities and Exchange Commission to investigate; a state lending license suspension; and at least five civil lawsuits filed in state and federal courts since January.

The latest plaintiffs are three affiliated California funds operating as WE Alliance. Together, they say they contributed about $4.6 million to Hanf’s Pacific Freedom Fund after receiving a private placement memorandum in April 2020 that promised their money would be invested in secured real-estate loans generating a fixed 6% annual return, paid monthly.

The complaint alleges that by early this year, Bill Brinkman, the restructuring officer retained by Pacific Private Money, had determined that Pacific Freedom Fund held investments in just six loans with a combined unpaid principal balance of about $5.3 million — against at least $74.2 million contributed by 138 investors. Of those six loans, only one was deemed collectible, with a principal balance of $189,677. The other five were either unsecured — meaning there was no real property to foreclose on — or held in a junior lien position likely to be wiped out by a senior lender. The fund had only $66,482 in cash.

The remaining money, the lawsuit says, had been transferred among the defendants themselves. According to the complaint, the fund moved $38.9 million to Pacific Private Money Inc., $18.4 million to Hanf Capital LLC, $13.7 million to Pacific Private Money Fund LLC, $4.1 million to Pacific Realty Development I LLC and $727,577 to Pacific Mortgage Capital LLC — a total of $75.8 million shifted to entities Hanf owned or controlled, rather than placed into the secured loans investors were promised.

Meanwhile, the complaint notes, Hanf was drawing a $250,000 annual salary. He was terminated as an employee on Feb. 4, according to court documents.

Beyond racketeering, the complaint alleges negligence, intentional misrepresentation, concealment, false promise, conversion and breach of fiduciary duty. The three plaintiff funds are seeking at least $4.6 million in compensatory damages, plus punitive damages and attorneys’ fees. WE Alliance Secured Income Fund contributed the largest share — at least $3.7 million — followed by WE Alliance Structured Strategies Stock Allocations Fund at $585,113 and WE Alliance Structured Active Allocation Growth Fund at $201,490.

That memorandum described Pacific Freedom Fund as a “gestational fund” — a vehicle that would originate short-term real-estate loans and sell them within 30 days, keeping the portfolio liquid and the risk low. Loans were to be secured primarily by senior deeds of trust on California real estate, with loan-to-value ratios generally not exceeding 80%.

What the offering did not disclose, the lawsuit alleges, was that the defendants never intended to invest the money as described.

The complaint is the latest in a series of civil actions against Pacific Private entities since January, according to reporting by the North Bay Business Journal.

David Hirsch, founder of Hirsch Vineyards in Sonoma County, sued through his investment company Santa Cruz Imports Inc. in late January, alleging he placed roughly $1 million in Pacific Freedom Fund in 2021 and received regular distributions until they stopped last November. Novato residents Daniel and Kelly Descalso filed suit in Marin Superior Court in late February, alleging they began investing in 2023 after being promised monthly returns of 8%, later pitched as high as 10%, and received only a fraction of $1 million they sought to withdraw in early 2025. The Descalsos named Hanf, Phan and investor contacts Edward Brown and Sam Thatcher as defendants.

Berkeley residents Mikhail and Tatyana Brodsky filed March 2, alleging they extended Pacific Private a $520,000 loan in late 2022 that was not repaid at maturity. Karen Green filed March 20, alleging the company failed to release a deed of trust on a Santa Rosa property after she paid off her loan, preventing her from selling the home. A civil case from 2025 also remains pending in Alameda County.

Pacific Private stopped paying its more than 130 investors in October or November and shut down all operations in February. A notice taped to the locked front door of the company’s Novato office directed account holders to contact Brinkman. In a January email obtained by the San Francisco Chronicle, Brinkman wrote that net recoveries “will be a fraction of total capital provided by investors.”

The SEC notified Pacific Private Money of an investigation in August 2025, according to court documents — months before the company's collapse became public. The state Department of Financial Protection and Innovation suspended Pacific Private's California Financing Law license for 30 days on March 16, after company representatives told regulators the firm had experienced a "severe liquidity crunch" in December. On April 6, the agency went further, summarily revoking the license entirely after the company failed to file a required annual report. The revocation order supersedes the March 16 suspension and prohibits Pacific Private from making or brokering any new loans, though it may continue to service existing ones. The company has 30 days from the date of service to request a hearing; if none is requested, the order becomes final.

The Marin District Attorney’s Consumer Protection Unit opened a consumer fraud investigation. Deputy District Attorney Sean Kensinger confirmed coordination with the FBI’s San Francisco division, which opened its own probe and established a victims’ portal where investors can submit information directly to investigators.

On April 1, Huffman wrote to SEC Chair Paul Atkins and FBI Director Kash Patel urging them to investigate Hanf personally and to seek the immediate appointment of a court-supervised receiver to protect remaining assets. Huffman wrote that his constituents who came forward were “not wealthy individuals” but people who had invested their life savings or retirement funds.

Investors have organized a coordination website at pacificprivatemoneyinvestors.com.

The legal scrutiny is not Hanf’s first.

He filed for Chapter 7 bankruptcy in 2007, a year before founding Pacific Private in Novato in the wake of the Great Recession. In 2014, the Bureau of Real Estate — now the California Department of Real Estate — suspended Hanf’s broker license and Pacific Private’s corporate license for 90 days each. A 2012 audit had found he commingled investor funds in non-trust bank accounts and loaned approximately $500,000 in client money to a separate real-estate company he managed, without disclosing the conflict to regulators. Under the settlement, 45 days of each suspension were served and the rest converted to a $4,500 penalty each; combined with investigation costs, the total penalties reached $19,617.

In February 2025, Hanf and a then-colleague, Edward Brown, were sued in U.S. District Court in Texas by a former business partner who alleged a scheme to defraud him. A court ordered that case to arbitration in December 2025.

Attorneys for Hanf did not respond to requests for comment before press time.

Corrected April 16, 2026: An earlier version of this story stated that Pacific Private Money's 30-day lending license suspension was set to expire April 15 and that no further action had been announced. In fact, the Department of Financial Protection and Innovation revoked the license outright on April 6 after the company failed to file a required annual report. The revocation order supersedes the suspension.

---

Reach Executive Editor Kevin Hessel at 415-435-2652.