OpenAI · SpaceX · Amazon · SEC · Fortune Technology
Their cash went to strip clubs, Bloomingdale’s, and shopping on Amazon, SEC alleges
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The Securities and Exchange Commission is dropping the hammer on private fund advisers who allegedly mishandled millions in investor assets under the guise of granting them lucrative pre-IPO shares in coveted startups such as OpenAI, SpaceX, and others.
Key facts
- In a second case announced on Wednesday, the SEC and federal prosecutors charged former naval officer Christopher Dinelli, 34, and Jacob Frankel, 32, with allegedly defrauding 35 investors of more
- He then allegedly paid the club $4,400 at 4:44 a.m. and then another $3,650 at 5:30 a.m
- The SEC says Dinelli allegedly misappropriated more than $1 million, including a $250,000 investment in a documentary film, and Frankel allegedly misappropriated more than $340,000, partly for trades
- Meyer allegedly tried to pay a $4,400 bill to the club at 4:41 a.m. using a debit card associated with Meyer Global Partners, but it was declined twice, the SEC claims
Summary
According to two separate cases announced on Wednesday, the SEC claims multiple fund advisers allegedly deceived mom-and-pop investors—including Navy veterans—about where the millions they thought they invested went. The SEC has brought a series of charges related to pre-IPO stakes, misappropriated investor funds, and hidden fees in recent months, following SpaceX’s blockbuster $1.8 trillion IPO in June. In an eye-popping case announced on Wednesday the SEC sued Owen Meyer, 35, and his firm, Meyer Global Management in federal Court in Manhattan, alleging Meyer raised at least $18.5 million from nearly 100 investors while misappropriating at least $1.27 million in client money along the way. Meyer allegedly tried to pay a $4,400 bill to the club at 4:41 a.m.