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Thursday, March 28, 2024 | Back issues
Courthouse News Service Courthouse News Service

Ponzi Schemers Ordered to Disgorge $45 Million

A federal judge Monday ordered Saddle River Advisors and allied investment firms to pay nearly $45 million to investors who put their money into a Ponzi scheme.

SAN FRANCISCO (CN) — A federal judge Monday ordered Saddle River Advisors and allied investment firms to pay nearly $45 million to investors who put their money into a Ponzi scheme.

The SEC sued John Bivona of New Jersey and his investment funds Saddle River Advisors and SRA Management Associates in March 2016.

The SEC said Bivona raised more than $53 million from investors for pre-IPO tech companies such as Uber and Airbnb, skimmed $5.7 million from it and diverted millions more to other “improper and undisclosed uses.”

Some of the money went to Bivona’s nephew, co-defendant Frank Mazzola, who had been barred from the securities industry in 2014 for running a similar scheme.

Bivona used investors’ money to pay Mazzola’s credit card bills, income taxes, car loan, attorneys’ fees and mortgage on a Jersey shore vacation home, the SEC says.

After freezing the assets of Bivona, Mazzola and the investment funds, U.S. District Judge Edward Chen appointed a receiver, Mountain View-based firm Sherwood Partners, to manage the investment funds’ assets in October 2016.

Bivona and Mazzola were held jointly liable to pay $4.65 million in December 2017. Bivona was also permanently barred from the securities industry.

On Monday, Chen issued a permanent injunction against Saddle River Advisors and its affiliated investment funds, permanently barring them from soliciting investments, and ordering them to pay $44.9 million in disgorgement.

Chen set a hearing for March 29 to review the receiver’s amended plan for distributing stock and liquidated assets to the cheated investors.

The SEC and investors’ attorney Jonathan Levine, of Pritzker Levine in Oakland, did not immediately return emails and phone calls seeking comment after office hours Monday.

Relief defendants include SRA I, SRA II, SRA III, all LLCs; Felix Investments LLC; Michele J. Mazzola; Anne Bivona; and Clear Sailing Group IV and V, LLCs.

Follow @NicholasIovino
Categories / Securities

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