Marco Giovanni Santarelli, Wire Fraud, California 2024

Santa Ana, California - Former CEO of Orange County-Based Private Equity Fund Charged with Conning Investors Out of $62.5 Million via Bogus Promissory Notes.

Marco Giovanni Santarelli, 56, of Laguna Niguel, has been charged with one count of wire fraud in connection with a scheme to defraud hundreds of investors out of approximately $62.5 million via a promissory note scam.

According to an information filed Monday, Santarelli founded and was the CEO of Norada Capital Management (NCM), a Laguna Niguel-based private equity fund. From June 2020 to June 2024, Santarelli solicited hundreds of investors nationwide to invest in unsecured promissory notes ranging from $25,000 to $500,000.

Santarelli promised the investors a high-yield monthly interest rate - approximately 12% to 15% - over three to seven years. He told investors they would receive monthly interest payments from income generated from five categories of businesses in which NCM would invest their money, including e-commerce, real estate, Broadway shows, and cryptocurrency.

However, instead of paying the promised returns and interest payments, NCM invested in risky assets that did not provide the promised safety and security, was unprofitable, had very little return on investment, and a large amount of debt. The balance sheets sent to investors hid more than $90 million in debt and included inflated assets. In Ponzi-scheme fashion, Santarelli made interest payments to investors using other investors' money.

In total, Santarelli caused more than 500 investors to lose approximately $62.5 million. If convicted, Santarelli would face a statutory maximum sentence of 20 years in federal prison.

Homeland Security Investigations and the FBI are investigating this matter with assistance from the United States Securities and Exchange Commission. Federal law enforcement has seized more than $5 million in proceeds connected to this scheme and continues to look for additional assets.

An information contains allegations. Every defendant is presumed innocent until proven guilty beyond a reasonable doubt in a court of law.

Santarelli is scheduled to make his initial appearance on October 20 in United States District Court in Santa Ana.

Source: https://www.justice.gov/usao-cdca/pr/former-ceo-orange-county-based-private-equity-fund-charged-conning-investors-out-625