April 13, 2024

SEC Charges Entrepreneur Fernandez with Investment Fraud

The Securities and Exchange Commission (SEC) has brought charges against Diana Mae Fernandez, a 37-year-old self-proclaimed entrepreneur, for orchestrating a fraudulent investment scheme. Fernandez, formerly a New Jersey resident, deceived investors by promising astronomical returns, sometimes as high as 63%, through investments in various sectors, including cryptocurrency, real estate, and private and public companies.

SEC Reveals Misuse of Investor Funds

Fernandez succeeded in raising approximately $364,000 from at least 20 individuals. She operated through two entities, “The Self-Made Success” and “Diana Mae K., LLC.” These operations were different from what they seemed. Instead of channeling the funds into the promised investments, Fernandez used the money for her extravagances. She paid for her day-to-day living expenses, indulged in lavish hotel stays, and even funded trips to glamorous destinations like Barcelona and Paris.

The SEC’s litigation release reveals the extent of Fernandez’s deceit. She touted over 15 years of investment experience and claimed to have raised $100 million in 25 countries. These claims, the SEC asserts, were entirely false. 

Additionally, Fernandez had a specific approach to collecting funds, urging investors to wire money directly to her bank account or send funds via PayPal. This allowed her complete control over the funds, which she predominantly used for personal gain, with a small portion allocated to pay earlier investors in a typical Ponzi-like fashion.

Legal Repercussions

Fernandez’s actions did not go unnoticed by legal authorities. In July, U.S. prosecutors charged her with investment fraud. The Justice Department’s statement highlighted that victims, including one from Marion County, West Virginia, invested over $300,000. Fernandez’s failure to deliver the promised returns and her subsequent misuse of investors’ money led to her arrest in Serbia. She now faces a potential sentence of up to 20 years in prison for each of the five counts against her.

The SEC’s action against Diana Mae Fernandez underscores the ongoing vigilance required in the investment world, especially concerning high-yield promises. Investors are advised to exercise caution and conduct due diligence before entrusting their funds to any investment venture.

Read Also: Coinbase Restricts Trading Leverage to Enhance Stability

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