Twice-convicted fraudster charged by SEC for alleged $38M Ponzi-like scheme

A fraudster who has been convicted twice before has been charged by the SEC for alleged involvement in a multimillion-dollar Ponzi-like scheme.

The regulator says that Eliyahu Weinstein, Aryeh L. Bromberg, Joel L. Wittels, Richard M. Curry, Christopher J. Anderson and Alaa Mohamed Hattab defrauded a total of $38 million from 150 individual investors who thought they were funding deals in health care products.

The Securities and Exchange Commission alleges that Weinstein, Bromberg, and Wittels used a firm called Optimus Investments Inc. for the fundraising, starting in October 2021, but they did not disclose Weinstein’s identity or that he has a criminal record.

Weinstein is a convicted felon, having admitted wire fraud and money laundering due to involvement in a real estate Ponzi-like scheme in 2013 which saw losses of $200 million, and a year later admitting to fraud, conspiracy, and money laundering charges in connection with a $6.7 million fraudulent securities offering.

Although sentenced to 24 years for these offences, his charges were commuted to time served by President Trump in January 2021.

PONZI-LIKE SCHEME

In the latest allegations, the SEC says that some of the Optimus deals proved to be unprofitable, prompting Weinstein, Bromberg, Wittels, Curry, and Anderson to use investors’ funds to make payments to early investors, purporting them to be investment returns.

It’s alleged that Hattab provided substantial assistance to the other defendants in carrying out the scheme.

“Over and over, the defendants took money from unsuspecting investors for fake deals and shuffled funds around to pay out earlier investors to give the false impression that they were receiving real profits from those deals, sometimes even concealing Weinstein’s criminal history and involvement in the deals,” said Antonia M. Apps, Director of the SEC’s New York Regional Office.

Related Topics: Fraud