(Bloomberg) — Hundreds of regular investors who together put up $63 million to buy pieces of Atlanta and Miami commercial real estate have allegedly seen their funds disappear.

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Two deals orchestrated by CrowdStreet Inc., a real estate investment company that crowd-sources funds from relatively wealthy individuals, have fallen apart as investors’ money vanished from bank accounts earmarked to buy equity in buildings, according to bankruptcy court papers.

An independent manager brought in to look at how the deals went sour found millions of dollars of the crowdfunded cash ended up in accounts owned by Nightingale Properties, a firm CrowdStreet partnered with on the transactions, along with Nightingale’s chief executive officer, court papers show.

“When we became suspicious of potential financial misconduct, we alerted regulators and negotiated for the appointment of an independent manager,” a representative for CrowdStreet said in an emailed statement Monday. “Financial fraud is a risk we take seriously, and we remain committed to providing investors with the best online real estate investing experience.”

Nightingale, based in New York, and Chief Executive Officer Elie Schwartz did not respond to requests for comment.

In order to investigate the accounts — and potentially recover funds — the independent manager put the two legal entities earmarked to buy equity in the Atlanta and Miami buildings in bankruptcy last Friday. Bankruptcy will allow the companies to come up with a repayment plan for creditors.

An attorney for Schwartz has said he will cooperate with the investigation, according to court papers.

Siphoned Accounts

Nightingale raised funds from accredited investors through CrowdStreet’s online platform. The money was then placed in two shell companies, which Nightingale was supposed to use to buy the properties: a sprawling office complex in Atlanta’s affluent Buckhead neighborhood, and a mixed-use building in Miami Beach.

Read More: World’s Empty Office Buildings Become Debt Time Bomb

The minimum investment from accredited investors was $25,000, according to a filing by Eric Lee, the entities’ chief restructuring officer. But while investor interest in the Atlanta Financial Center complex exceeded expectations — garnering 238% more funding than it had set as a goal — financing for the Miami building deal fell short.

After pulling in more money from other investors and putting in its own equity, Nightingale was supposed to facilitate the deals, according to court papers. In the meantime, the firm was expected to leave the CrowdStreet investors’ money in two different entities — ONH AFC CS Investors and ONH 1601 CS Investors — untouched.

Eventually the deals languished, encountered delays, and some investors requested refunds. While some of those refunds have been made, many remain outstanding, according to Lee.

In June, Anna Phillips, the newly appointed independent manager for the entities, launched an internal investigation to track down the funds. She soon discovered that the entities’ bank accounts had been drained. The accounts only had $125,000 and $1,600 left, according to court papers.

Filing for bankruptcy will allow Phillips and Lee to investigate where the money wound up, court papers show.

“The debtors will be greatly assisted in this investigation by the ability to use the powers of the Bankruptcy Code to investigate these prepetition activities,” Lee wrote in a bankruptcy filing on Friday.

(Corrects description of fund flows in paragraphs three and eight.)

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