The former head of Woodbridge Group of Companies and two former directors were arrested Thursday on federal criminal charges for their roles in a massive Ponzi scheme that the SEC claims defrauded up to 8,400 investors, many of them senior citizens.
The defendants include Woodbridge owner Robert H. Shapiro, 61, and directors Ivan Acevedo, 42, and Dane R. Roseman, 35. They were charged with conspiracy to commit mail and wire fraud and other violations in an indictment unsealed in the Southern District of Florida, according to a statement from the U.S. Attorney's Office.
In January, a federal court in Florida ordered Woodbridge, related companies and Mr. Shapiro together to pay $1 billion in disgorgement and fines for operating this Ponzi scheme.
In a separate civil action Thursday, the SEC charged Mr. Acevado and Mr. Roseman for their roles in the scheme. Mr. Shapiro had previously been charged in a civil action by the SEC.
The three executives were arrested on Thursday in California, according to the U.S. Attorney's Office. Mr. Shapiro was ordered to be detained in prison, while Mr. Roseman and Mr. Acevedo were ordered to appear for arraignment in U.S. District Court in the Southern District of Florida.
An attorney for Mr. Shapiro, Ryan O'Quinn, did not return a call seeking comment. Mr. Roseman and Mr. Acevedo could not be reached for comment.
The SEC complaint alleges that Mr. Acevedo oversaw Woodbridge's fundraising for Woodbridge's securities from 2012 until his departure in 2015, when he was succeeded by Mr. Roseman.
According to the complaint, the defendants were responsible for hiring and training Woodbridge's sales force, approved fraudulent marketing materials and sales scripts, and helped create the false appearance that Woodbridge was a legitimate operation when in reality it was a Ponzi scheme that used money from new investors to pay existing investors.
"Instead of telling investors the truth — that Woodbridge's third-party lending business was a sham almost from inception — we allege that Acevedo and Roseman worked diligently to perpetuate this sham by preparing and disseminating false marketing materials to induce more investments, keeping this massive Ponzi scheme afloat," Eric I. Bustillo, director of the SEC's Miami Regional Office, said in a news release. "The SEC is committed to continue to hold responsible parties accountable in this far-reaching scheme."