Ministers used influence to pilfer millions in alleged Ponzi Scheme

Regulation

A recent filing from the United States Securities and Exchange Commission, or SEC, takes action against three individuals for allegedly raising millions of dollars against more than 1,000 victims. 

“From 2017 to May 2019, Jali, Frimpong, and Johnson, directly and through two entities created to perpetrate the scheme, Smart Partners and 1st Million (the ‘Companies’), fraudulently raised more than $27 million from approximately 1,200 investors, many of them African immigrants,” an Aug. 28 legal filing states.  

The allegations claim the three individuals used their influence in churches and health care, preying on commonalities and beliefs of those around them for financial gain. Johnson claimed to be a minister, while Jali reportedly pastored at seven church locations, as noted in the legal document. Leading investors to believe they would make profit on crypto and Forex on their behalf, the accused parties allegedly claimed themselves as experts, promising to give back initial invested capital one year later. 

The filing states the defendants spent this money on themselves instead of using it as advertised. 

“From 2017 to May 2019, Defendants offered and sold to investors in Maryland and several other states, including Georgia, Florida, and Texas, among others, contracts with the Companies in which they falsely promised, among other things, to generate profits for investors by trading Forex and cryptocurrency,” the filing sates.

The document notes a $5,000 minimum investment as their common requirement, advertising gains between 6% and 42% per month or financial quarter. The accused allegedly paid out some of the earlier investors at times to ward off suspicion. 

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