The accounting scandal at American Realty Capital Properties Inc. is threatening to upend a real estate empire built by Nicholas Schorsch in an industry where reputation propels growth.
The disclosure last week that accounting errors were intentionally concealed at the real estate investment trust, leading to the resignation of two executives, has erased almost $4 billion in market value, sparked an FBI investigation and a review by the U.S. Securities and Exchange Commission. It also is leading some brokers to halt sales tied to Schorsch’s AR Capital LLC, the biggest sponsor of nontraded REITs.
