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“Ponzi-Like”: SEC Blocks Zera Financial from Ongoing Effort Promising 36% Annual Return. Funds Dissipated

SEC Files Enforcement Action Against Zera Financial and Luis A. Romero: $2.28 Million Raised from 168 Investors Allegedly “Dissipated”

The Securities and Exchange Commission (SEC) has taken legal action against Zera Financial and its co-founder Luis A. Romero, alleging that they raised over $2.28 million from approximately 168 investors, only for the funds to be “dissipated.” The complaint filed by the SEC accuses Zera and Romero of making false promises of 3% monthly returns, equivalent to more than 36% annual returns, on investments as low as $500. They also allegedly misled investors by claiming that investments in Zera were FDIC-insured, a statement that has been proven to be false.

The offering of Zera’s investment opportunity was promoted on various platforms, including the internet, an Instagram account, and even through an App available on Google Play and the App Store. Zera positioned itself as being powered by Fintech or a Banking as a Service provider.

In March of this year, the FDIC sent a cease and desist letter to Zera due to the inaccurate claims being made. While Zera removed the FDIC claims, they continued to portray the offering as a secure investment.

One of Romero’s tactics involved posing as an investor on Reddit, where he assured potential investors that Zera was a reputable and secure opportunity, highlighting the returns he had personally experienced.

According to the complaint, Romero diverted some of the investor funds into personal accounts and three crypto accounts, using the money for personal expenses such as equestrian products, tropical fish, furniture, apartment rent, and car payments. He also transferred around $61,000 of investor funds to a church and withdrew over $710,000 in cash from the Zera accounts.

As a response to the SEC’s allegations, a court has granted emergency relief against Zera and Romero, which includes a temporary restraining order and an order for freezing assets. A hearing regarding the case is scheduled for October 11, 2023.

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