Two hedge fund managers in San Francisco raked in almost $10 million from a Ponzi scheme over the past three years and spent it on “excursions” to casinos and strip clubs, according to an indictment from the Justice Department.
Jaswant S. Gill, alias Jason Gill, age unknown “as he uses multiple birthdates and Social Security numbers,” and Javier Rios, 33, took advantage of more than 200 investors through several “hedge fund” companies under JSG Capital Investments since September 2013.
With the millions hidden in accounts belonging to the company, Gill and Rios bought flights, and took “excursions to high-end restaurants and clubs, jaunts to Las Vegas casinos, gentlemen’s clubs, professional sporting events, high-end hotels, and luxury retail stores,” the indictment said.
Gill and Rios sold fake pre-IPO stocks in hot internet companies like Uber, Airbnb and Alibaba, and promised investors fixed returns of 60 percent annually until the stock went public. Among other of methods the two alleged fraudsters used to attract investors, the JSG website targeted advertised retirees, advertising a testimonial from a gentlemen who is quoted as saying “has allowed me to not worry about living off SSN benefits and going thru my retirement savings.”
The JSG website, which has been removed, promised to “bring investment opportunities to average Americans” and “level the playing field” by offering financial packages typically reserved for the 1 percent.
The company raised nearly $10 million from fraudulent activities, and Gill and Rios kept $5.5 million for themselves. They paid back about $4.2 million as “interest” payments to keep their investors happy, marking the checks as ”
Gill and Rios are charged with wire fraud and conspiracy to commit wire fraud, the Department of Justice said. If convicted, the two face up to twenty years in prison, substantial fines and repayments of the stolen assets.
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