SEC sued BNZ One Capital and its co-founders for operating a Ponzi-like scheme

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According to the Commission, BNZ One Capital hasnt been profitable since Barber and Zimmerle established the company. The co-founders’ investments failed to generate sufficients profit to repay investprs’ principal and the promised returns.

The defendants raised $6.9 million from investors between June 2019 and February 2020. Of that amount, they only invested $2.7 million and generated less than $5,000 in profits from those investments.

Barber and Zimmerle used investors’ funds to returns in a Ponzi-like scheme. They also used investors funds to pay themselves substantially including transferring thousands of dollars to Barber’s company, Guaranteed Income Solutions (GIS). The SEC included GIS as a relief defendant in the case.

After March 2020, the defendants raised an additional $6.6 million by misleading investors about BNZ One Capital’s profitability. They continied their Ponzi-like payments to investors andlavish payments to themselves, the SEC further alleged.

Overall, the defendants raised $13.5 million from investors. They only invested $6.4 million and generated barely $300,000 in profits. They paid at least $1.7 million in returns to investors in a Ponzi-like scheme. BNZ One Capital tranferred more than $1.6 million to GIS and over $700,000 to Zimmerle. The company also paid its co-founders including personal expenses including for meals, travels, and vehicles.