SEC Charges Loan Underwriter For Role In Nearly $200 Million Ponzi Scheme
On September 27th, 2022, the Securities and Exchange Commission (SEC) announced that a Florida man named Christian J. Gonzalez—a loan underwriter associated with MJ Capital Funding, LLC—has been charged with securities fraud. MJ Capital Funding, LLC is part of an ongoing $196 million Ponzi scheme investigation. Below, our Miami Ponzi scheme attorney provides a comprehensive overview of the charges and the nine figure investment fraud scheme.
Background: SEC Charged MJ Capital Funding, LLC for $196 Million Ponzi Scheme
In August of last year, the SEC brought Ponzi scheme charges against MJ Capital Funding, LLC, its primary owner Johanna M. Garcia, and related investment entities. The SEC alleges that Ms. Garcia used MJ Capital Funding, LLC and the related entities in order to raise a large amount of money (nine figures) from more than 2,000 investors.
The investors were promised safe, secure returns that were well above the market rate. Indeed, investors were purportedly told that they could expect to more than double their money in the course of a year. The SEC contends that MJ Capital Funding, LLC was operated in a manner consistent with a typical Ponzi scheme—funds were shuffled around to pay off new investors.
Allegations: Christian J. Gonzalez Was a Loan Underwriter for the Ponzi Scheme
As a “hook” for the Ponzi scheme, the SEC alleges that MJ Capital Funding, LLC offered a type of specialized cash advance loan. According to the complaint filed in a federal court in South Florida, Christian J. Gonzalez served as a “loan underwriter” for MJ Capital Funding, LLC. The SEC complaint alleges that Mr. Gonzalez made a series of material misrepresentations and material omissions to sales agents at the company.
These sales agents reportedly made similar misrepresentations and omissions to actual and prospective investors. While Mr. Gonzalez told sales agents that the company had underwritten hundreds of loans as part of its businesses; it had only actually completed 13 such loans. While more than $100 million was raised from investors, the SEC believes that less than $1 million was actually used for the commercial purpose of making loans.
SEC Seeks a Wide Range of Sanctions Against Alleged Ponzi Scheme Underwriter
As part of its securities fraud complaint, the SEC is seeking a number of different sanctions against former MJ Capital Funding, LLC loan underwriter Christian J. Gonzalez. To start, the agency seeks a finding that Mr. Gonzalez violated federal securities law. In addition, the SEC is seeking a wide array of specific remedies, including injunctive relief to stop further violation, disgorgement of any and all ill-received proceeds, and payment of a civil financial penalty.
Consult With a Miami, FL Ponzi Scheme Losses Attorney Today
At Carlson & Associates, P.A., our Miami Ponzi scheme losses lawyers fight to protect the rights and interests of investors. If you sustained losses because of a Ponzi scheme, our law firm will help you evaluate the options for seeking compensation. Contact us today to set up a fully private review of your case. We handle Ponzi scheme losses claims throughout Florida.
Source:
sec.gov/litigation/litreleases/2022/lr25527.htm