12:57pm PT by Ashley Cullins
New York Duo Sued Over $81M Ponzi Scheme Aimed at Broadway Shows, Concerts
Two New York men are facing a fraud lawsuit for allegedly running a Ponzi scheme that purported to be a ticket reselling venture for in-demand shows including Adele concerts and Broadway's Hamilton musical.
The SEC claims Joseph Meli and Matthew Harriton raised more than $81 million from at least 125 investors in 13 states by misleading them to think their money would be pooled to buy large blocks of tickets to shows that could be resold for a profit. In reality, the SEC alleges the funds were used for making Ponzi payments to prior investors and for personal expenses including private school tuition and casino payments.
U.S. Attorney’s Office for the Southern District of New York is pursuing criminal charges against Meli and the SEC has filed a civil lawsuit against him and Harriton in New York federal court.
“As alleged in our complaint, Meli and Harriton raised millions from investors by promising big profits from reselling tickets to A-list events when in reality they were moving investor money in a circle and creating a mirage of profitability,” said Paul G. Levenson, director of the SEC’s Boston regional office, in a Friday statement.
According to the SEC’s complaint, Meli and Harriton falsely told investors that they had a deal with the producer of Hamilton to secure 35,000 tickets to the show and their money was purportedly going to be used to pay for those tickets with a promised return on their investment within eight months.
The SEC is asking the court to freeze Meli's and Harriton's assets and prohibit them from accepting or depositing any additional investor funds and is seeking a disgorgement of their profits.
Read the full SEC complaint below.