SEC Charges Two Florida Firms and Principal Officer Over Alleged Ponzi Scheme

Posted on August 27th, 2021 at 12:47 PM
SEC Charges Two Florida Firms and Principal Officer Over Alleged Ponzi Scheme

From the Desk of Jim Eccleston at Eccleston Law:

The Securities and Commission Exchange (SEC) has been granted a temporary restraining order (TRO) as well as an asset freeze against Florida resident Johanna Garcia along with two entities she owns. The SEC’s complaint, which was filed in federal court in the Southern District of Florida, alleges that Garcia used her entities, MJ Capital Funding LLC as well as MJ Taxes and More Inc., to perpetrate a Ponzi scheme and misappropriate investor funds. Garcia and her entities raised nearly $70 million in funds from at least 2,150 investors through a fraudulent securities offering, according to the complaint. 

The complaint further alleges that Garcia informed investors that offering proceeds would be used to fund small business loans known as “merchant cash advances” while promising investors annual returns of 120-180%. Nevertheless, the defendants only managed to raise $2.9 million in merchant cash advance loans as well as even less revenue. The defendants instead utilized nearly $20 million of investor funds to pay returns to previous investors, according to the complaint. The complaint additionally alleges that the defendants fraudulently paid $27.4 million of investor funds to other unassociated entities, including large payments to sales agents for promoting these investments. 

Eccleston Law LLC represents investors and financial advisors nationwide in securities, employment, regulatory and disciplinary matters.

Tags: eccleston, eccleston law, sec, ponzi scheme

Return to Archive

TESTIMONIALS

Previous
Next

I am so blessed to have you and your dynamic team defending me. Your ethics, forward thinking and strategies are amazing.  You guys are the best group of attorneys in the country that I could hire to handle this complicated case.

Cindy C.

LATEST NEWS AND ARTICLES

December 19, 2024
GPB Capital Investors See Progress as Court Confirms Receivership

In a significant development for investors in GPB Capital Holdings, the private equity firm will move into receivership following a prolonged legal battle.

December 18, 2024
SEC Fines Cantor Fitzgerald $6.75 Million for Misleading SPAC Investors

The Securities and Exchange Commission (SEC) has charged Cantor Fitzgerald, L.P. with causing two special purpose acquisition companies (SPACs) under its control to make misleading statements to investors before their initial public offerings (IPOs). 

December 17, 2024
Former Western Asset Management Co-CIO Charged with Fraud for Cherry-picking Trades

The SEC recently charged Ken Leech, former Co-CIO of Western Asset Management, with fraud.