SEC: Get-rich-quick influencer Tai Lopez was running a Ponzi scam

The Securities and Exchange Commission alleges that the get-rich-quick investment tips offered by prominent social media influencer Taino “Tai” Lopez were little more than Ponzi-style scams.

Federal authorities have charged the leadership of Retail Ecommerce Ventures with orchestrating a massive fraudulent securities scheme that allegedly raised more than $230 million from 660 investors nationwide.

According to a complaint filed in the U.S. District Court for the Southern District of Florida, defendants Alex Mehr and Tai Lopez used REV to buy up retail names on cheap terms. The partners bought RadioShack, Pier 1 Imports, Dressbarn, Modell’s Sporting Goods and Linens ‘N Things, with an eye on turning them into online sellers.

Lopez famously touted the approach in online promotional videos as “one of the best strategies you can invest in.”

The SEC alleges that of the $230 million raised, approximately $112 million was sourced through fraudulent offerings across eight specific REV "Retailer Brands."

The defendants allegedly lured investors through aggressive social media campaigns on YouTube, Twitter and Facebook, as well as bi-weekly Zoom calls and lavish in-person events in Las Vegas and Puerto Rico.

Investors were offered unsecured notes promising annualized returns as high as 25% or equity units with monthly dividends of up to 2.083%. Lopez reportedly justified these high returns by claiming the company acquired distressed assets "cheaply" and maintained low overhead by employing overseas staff.

Lopez, 48, who produces a podcast, “The Tai Lopez Show,” hasn’t addressed the company’s collapse and the losses suffered by his investors, the Wall Street Journal reported. The day after the SEC filed suit, Lopez posted on X: “Never doom. No matter how horrible the situation, don’t ever think you’re doomed. Unless you are dead, all defeat is psychological.”

Misleading use of proceeds

The complaint highlights that while investors were told they could invest in specific portfolio companies—with their money remaining in that "particular entity"—the fine print in Letters of Intent allowed the defendants to use proceeds for "any general business purposes" of the company and its affiliates.

Federal regulators state these offerings constitute securities under the Securities Act and Exchange Act, meeting the "Howey Test" criteria as investment contracts where profits were expected solely from the managerial efforts of the defendants.

Alongside Mehr and Lopez, the complaint names Maya Burkenroad as a participant who helped countersign investor agreements. The SEC is seeking permanent injunctions, disgorgement of ill-gotten gains and civil penalties.

The SEC alleges that Lopez and Mehr used the "purported success" of early acquisitions to bait new investors while simultaneously hiding mounting losses. In a February 2021 email, Lopez reportedly told investors that the Dressbarn and Stein Mart brands were “on fire” and that cash flow was "strong."

However, internal financial statements—which the SEC claims were withheld from investors—tell a different story. Dressbarn recorded losses of $13.7 million in 2020 and $10.7 million in 2021. Stein Mart similarly faltered, losing $5.7 million in 2021.

By mid-2022, consolidated internal records showed the REV umbrella was hemorrhaging between $3.8 million and $12 million every month. Despite this, the defendants allegedly boasted that they had "never missed a cash payment." In reality, the SEC claims REV was resorting to a "triage" system, using money from new investors and high-interest merchant cash advances to pay off old ones—a hallmark of a Ponzi scheme.

The pressure culminated in November 2022 at an investor conference in Las Vegas. Even as payments to some investors had already ceased, Mehr allegedly urged prospective backers to go "all in," writing in an email: "If you don’t want to look like a joker, then the time to get in on REV is now."

The deal "folded" shortly after. Following weeks of silence, Lopez held a final Zoom call on Dec. 15, 2022, admitting for the first time that the companies were in financial ruin and payments would stop.

SEC: Executive not qualified

The investigation also cast doubt on the professional pedigree of REV’s leadership. While the company website described president and chief risk officer Maya Burkenroad as having "over 10 years of experience managing multi-million-dollar companies," federal investigators found a starkly different resume.

Prior to her executive roles at REV, Pier 1 and Dressbarn, Burkenroad’s work history allegedly included stints as a substitute preschool teacher and a radio station promoter. The SEC asserts she had "no identifiable experience" managing any company before being appointed by Lopez, who is her cousin.

Beyond mismanagement, the SEC alleges Lopez and Mehr treated investor capital as a personal "piggy bank." Despite promises that funds would be used for specific retail entities, the complaint states that money was routinely commingled and redirected to enrich the defendants personally.

The complaint alleges that the defendants transferred at least $5.9 million in investor proceeds directly between portfolio companies, contrary to the written and oral promises made to investors. At least another $5.9 million of the returns distributed to investors were, in reality, “Ponzi-like payments funded by other investors,” the SEC said.

Lopez and Mehr allegedly misappropriated about $16.1 million in investor funds for their personal use, the complaint states.

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