The lawsuit follows an Outlier Media investigation published earlier this year that brought attention to the company’s practices.
RealToken operates by selling shares of rental properties through digital tokens. These properties, mostly in Detroit, are held by a network of limited liability companies tied to RealToken. Investors purchase tokens that represent ownership in the property, and in return, they receive rental income and voting rights over property-related decisions. Each property is assigned a management company responsible for day-to-day maintenance and tenant support.
On its website, RealToken claims it enables investors “around the globe” to access the US housing market through “fully-compliant, fractional, tokenized ownership.” Since its launch in 2019, the company says it has registered more than 65,000 investors.
But according to Detroit officials, the promised innovation has resulted in longstanding neglect, unpaid taxes, and non-responsive ownership.
“The company made a number of promises as well in a Zoom call and a lot of subsequent calls as well,” city council president James Tate said in a statement. “Not one promise has been kept. They call. Not one thing has been moved. They’re not responsive. And they have not been paying their property taxes either. So, it’s personal. It’s personal.”
