Denver developer Brian Watson defrauded investors in 11 real estate deals, jury finds after SEC trial

Brian Watson Found Liable for Civil Securities Fraud

After placing his faith in nine jurors to vindicate him from allegations of misconduct by federal investigators, Brian Watson was disappointed to learn that the jury had found him and his real estate firm, Northstar Capital Partners, guilty of civil securities fraud. The jury deliberated for five hours before reaching their decision, determining that Watson and Northstar had misled investors between 2017 and 2019 by falsely claiming that they would be coinvesting in projects.

Watson, once a wealthy developer with a net worth exceeding $60 million, remained composed as the verdict was read, while his son Chase appeared visibly upset. The charges against Watson were civil in nature, so his punishment will be financial.

During the five-day trial, Watson testified at length about his background and real estate career, painting a picture of a self-made entrepreneur who had faced challenges and setbacks along the way. The Securities and Exchange Commission (SEC) focused on 11 specific real estate deals where Watson and Northstar had allegedly failed to invest the promised 5% equity, leading investors to believe they were sharing in the risk.

While Watson and his legal team argued that the SEC had cherry-picked projects and that investor materials were not legally binding, the SEC maintained that Watson had intentionally misled investors and used their funds for personal gain. Witnesses from both sides testified about Watson’s investment practices and the impact on investors.

As the trial came to a close, both sides agreed that the focus had been on Brian Watson and his actions. Watson portrayed himself as a victim of a conspiracy involving Amazon and government officials, while the SEC presented him as a fraudulent businessman who had deceived investors.

Ultimately, the jury sided with the SEC, holding Watson and Northstar liable for securities fraud. Watson’s sentencing will be determined at a later date, marking a significant legal setback for the once-prominent developer.

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