SAN FRANCISCO (CN) - A federal judge froze the assets and bank accounts of two Southern Californians, their wives and their companies as the SEC investigates what it calls a "classic Ponzi scheme."
The SEC in late May accused Jaswant S. Gill and Javier Rios, who run JSG Capital Investments and two JSG affiliates, of taking $10 million from investors by promising to buy pre-IPO shares in companies such as AirBnb and Uber, but keeping the money for themselves.
The SEC's May 25 federal complaint claims Gill, of San Diego, and Rios, of National City, spent less than 1 percent of the money on stock, and none of it on pre-IPO shares.
U.S. District Judge Jeffrey White on Friday granted a preliminary injunction freezing the defendants' assets.
"Good cause exists to believe that, unless restrained and enjoined by order of this Court, Defendants and Relief Defendant will dissipate, conceal, or transfer assets which could be subject to an order directing disgorgement or the payment of civil money penalties in this action," White ruled.
The SEC claims the men bilked nearly 200 investors with fraudulent promises of "access to alternative investment strategies that were previously only available to the one-percenters."
The SEC said it does not know the age of Jaswant Gill, aka Jason Gill, because "he uses multiple birthdates and Social Security numbers." He's the founder and CEO of defendants JSG Capital Investments and JSG Capital, both LLCs.
Rios, 33, the sole member of defendant JSG Capital Investments, has been working with Gill since at least September 2014. "His professional background is in food service," the SEC says.
Gill took at least $1 million of his suckers' money in cash, and Rios at least $1.7 million, the SEC says. They spent another $500,000 on "excursions," and doled out $4.2 million in Ponzi payments, according to the SEC complaint.
Gill claims to have been a managing director at Morgan Stanley with "close ties" to well-known Silicon Valley venture capital firms, whom he advertises as his "partners and mentors" — none of which is true, the SEC says.
The website for JSG Capital Investments has been taken down and its phone number is out of service.
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