A South Florida woman known as “Mother Teresa” in her community has been accused of running her business as a lucrative Ponzi scheme that swindled nearly $200 million.
Joanna M. Garcia, of North Lauderdale, has secured over 15,400 investors up to $196 million through her company, MJ Capital Funding LLC, NPR reported Tuesday.
Founded in 2020, MG Capital A pledge to connect investors with small businesses through a Merchant Cash Advance, or MCA.
She is described as a “hardworking woman with priorities” in Her company biographyGarcia bragged about being a humble businesswoman who helped ordinary people create wealth – she was even referred to as “Mother Teresa.” [sic] in her community.”
The scam began to unravel in April 2021, when a website appeared that accused MJ Capital of running the Ponzi scheme.
Garcia sued the anonymous whistleblower for defamation and continued to raise money from investors until August 2021, when the Securities and Exchange Commission filed a formal complaint against the company.
In the Document dated August 9ththe Securities and Exchange Commission alleges that MG Capital used investor funds to fund annual external “returns” of 120%-180%”, while the company’s top companies divested from investments in personal travel and luxury goods.
In addition to using an infusion of fresh money to satisfy existing investors, the SEC claims that MG Capital used unlicensed brokers and sales agents to sell unregistered securities.
Federal judge responds to Garcia’s asset freeze lawsuit and request receivership.
While Garcia awaits further investigation, the case against MJ Capital got new fodder last Tuesday, when the SEC filed Complaint again v. Pavel Ruiz, a member of the company’s board of directors.
The Securities and Exchange Commission argues that Ruiz, 29, played a “significant role in perpetuating the Ponzi scheme.”
Armed with a team of about 70 sales agents, Ruiz allegedly defrauded more than 5,100 investors with at least $46 million, $7.7 million transferred to his personal accounts.
According to the Securities and Exchange Commission, Ruiz used some pocket money to buy a luxury car and crypto assets.
On the same day the Securities and Exchange Commission complaint was issued, the US Attorney’s Office for the Southern District of Florida Ruiz charged Conspiracy to commit wire fraud.
It is unclear whether Garcia, who was not named in the federal case, will face similar charges as well.
If convicted, Ruiz faces up to 20 years in prison.
As of last week, both Garcia and Royce have reached partial settlements with the Securities and Exchange Commission, delaying financial penalties until the completion of any criminal proceedings.
Ruiz Currently free On bonds of $250,000.
The MJ Capital scandal is just the latest in a disturbing string of similar cases, some of which have seen investors defraud hundreds of millions of dollars.
In March of this year, The Post reported a crackdown on a $300 million Ponzi scheme Ended with FBI fire in Las Vegas. Just last month, the SEC filed a complaint against 11 people for their role in Detailed Cryptographic Pyramid Diagram aimed at retail investors.
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