Financial and Investment Fraud

February 17, 2023

Two individuals who ran a Ponzi scheme involving cattle and marijuana have been sentenced to 6 years in prison and ordered to pay almost $16 million in restitution each.  Additionally, Reva Joyce Stachniw was ordered to forfeit $6 million, and Ron Throgmartin was ordered to forfeit $1 million.  DOJ

February 16, 2023

Derivative clearing organization (DCO) The Options Clearing Corporation (“OCC”) has been ordered to pay $17 million to the SEC and $5 million to the CFTC for its failure to establish, implement, maintain, and enforce policies and procedures to manage operational risks related to its automated systems, in violation of numerous rules and regulations, including the Commodity Exchange Act and CFTC regulations called DCO Core Principles.  Due to those deficiencies, between 2019 and 2021, OCC’s Clearing Fund was underfunded by $200 million to nearly $600 million.  OCC previously settled other charges with the SEC for $15 million and the CFTC for $5 million.  SEC; CFTC

February 7, 2023

Saivian LLC and owner EJ Dalius have agreed to pay $24 million in disgorgement, prejudgment interest, and penalties for operating a multimillion-dollar Ponzi and pyramid scheme.  According to the SEC, Savian and Dalius promised investors 20% cash back on retail shopping purchases as long as they paid a $125 fee every 28 days and submitted receipts for their purchases.  Savian and Dalius claimed the cash back payments were funded by monetizing receipt data, when in fact, it was funded by payments from prior investors.  In addition to the Ponzi scheme, Savian and Dalius also ran a pyramid scheme wherein affiliates sold memberships to others down the line.  SEC

January 24, 2023

The SEC has awarded more than $28 million to a pair of whistleblowers whose information and assistance prompted the SEC to launch an investigation and enable the return of millions of dollars to harmed investors.  These actions ultimately led to a successful enforcement action.  SEC

January 24, 2023

A former energy company executive accused of defrauding investors of more than $15 million and misappropriating investor funds has been sentenced to 5 years in prison after pleading guilty to wire fraud.  While serving as the executive chairman and managing partner of Citadel Energy, which supposedly helped oil and gas companies with fluid management, Joey Stanton Dodson made false and misleading representations and omissions to investors concerning the intended use of their funds and his own compensation.  After obtaining over $15.6 million from over 50 investors, Dodson misappropriated $1.3 million into his own accounts, and used some of it to repay investors of unrelated entities.  DOJ

January 23, 2023

Charlie Abujudeh of California has been ordered to pay over $5 million for his role in defrauding retail investors through a microcap fraud scheme.  Abujudeh and associates allegedly made misleading statements during high pressure sales calls and email promotions to urge investors to invest in Odyssey Group International, Inc., Scepter Holdings, Inc., and CannaPharmaRx, Inc., then gave hundreds of thousands of investor funds to a contact within Odyssey.  SEC