Podcast host and entrepreneur Matthew Motil is facing charges from the Securities and Exchange Commission (SEC) for allegedly operating a Ponzi-like scheme that saw him defraud 50 investors out of $11 million. The SEC claims that Motil, based in North Olmstead, Ohio, promoted promissory notes that were supposedly secure investments backed by residential real estate in Ohio.
According to the SEC complaint, Motil misled investors by claiming that the promissory notes were fully collateralized by property. However, it was discovered that he had issued multiple notes secured by the same property. The complaint alleges that Motil obtained over $1.3 million from 20 investors by issuing 20 notes secured by a single-family home, which was only valued at $130,000 despite being purchased for $47,000.
Motil is accused of using the investors’ funds for personal expenses, making Ponzi payments, diverting money to unrelated businesses, and routing hundreds of thousands of dollars to his wife. The complaint reveals that Motil operated through various entities and LLCs, raising funds from investors across the United States.
The SEC complaint provides insight into some of the extravagant personal expenses Motil allegedly paid for using investor money. These include over $1 million in personal credit card charges, a seven-month rental of a lakeside mansion for over $107,000, courtside seats to the Cleveland Cavaliers for over $73,000, and various purchases from Best Buy totaling over $37,000. Additionally, he reportedly spent over $23,000 on a fitness business called “Leeny’s Lean Body,” over $22,000 on iTunes, and over $14,000 at Starbucks. Motil also made substantial cash withdrawals amounting to $58,000.
Motil filed for bankruptcy in 2022. The SEC seeks various penalties including injunctive relief, disgorgement with prejudgment interest, civil money penalties, and an officer and director bar for Motil.
Mark Cave, Associate Director of the Division of Enforcement, stated that the SEC is committed to holding individuals like Motil accountable for their unlawful conduct.
This case serves as a reminder of the importance of thoroughly vetting investment opportunities and conducting due diligence before investing significant funds. The SEC continues to work diligently to protect investors and maintain the integrity of the financial market.
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