Gignesh Movalia, Investment Advisor Fraud, Florida 2023

Gignesh Movalia, a 40-year-old Tampa investment advisor, has pleaded guilty to orchestrating a $9 million investment fraud scheme involving Facebook stock. According to a guilty plea entered in the Middle District of Florida, Movalia began soliciting investments for the OM Global Fund, an investment fund he founded and managed in 2009, by promising access to pre-initial public offering (IPO) shares of Facebook Inc.

Movalia, who was registered as an investment advisor, admitted to raising more than $15 million for the OM Global Fund, with over $9 million used for ‘side pocket’ investments that he claimed were for purchasing Facebook shares. However, he used funds designated for Facebook shares for other investments, concealing this from investors and making material misrepresentations to them.

The OM Global Fund lost approximately $9 million before it went into receivership in September 2013. Movalia’s guilty plea was announced by Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney A. Lee Bentley III of the Middle District of Florida, Special Agent in Charge Paul Wysopal of the FBI’s Tampa Field Office, and Inspector in Charge Ronald J. Verrochio of the U.S. Postal Inspection Service’s Miami Division.

Gignesh Movalia, 40, of Tampa, a registered investment advisor, pleaded guilty to one count of investment advisor fraud. Sentencing will be scheduled at a later date.

According to the plea agreement, Movalia was the founder and manager of OM Global Investment Fund LLC (the OM Global Fund), an investment fund formed in 2009. He admitted to soliciting investments for the OM Global Fund by touting access to pre-IPO shares of Facebook Inc. and making material misrepresentations to investors.

The case is being investigated by the FBI and USPIS, with assistance provided by the U.S. Securities and Exchange Commission’s Miami Regional Office. The case is being prosecuted by Trial Attorney Andrew H. Warren of the Criminal Division’s Fraud Section.

The guilty plea marks a significant milestone in the investigation, which has been ongoing since 2013. The case highlights the importance of due diligence and caution when investing in the market, and the devastating consequences of investment advisor fraud.

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