SEC Charges Daryl F. Heller with Ponzi Scheme
The Securities and Exchange Commission (SEC) has charged Daryl F. Heller and his companies, Prestige Investment Group and Paramount Management Group, with running a Ponzi scheme that led to approximately $400 million in investor losses over several years.
Details of the Allegations
From January 2017 to June 2024, Heller raised over $770 million from about 2,700 investors by falsely claiming to operate a profitable ATM network. The complaint alleges that:
- Heller created a false impression of a successful nationwide ATM network.
- Investors were paid returns primarily using funds from new investors and high-interest loans.
- Heller misappropriated more than $185 million for personal use, including purchasing a beach house.
“Heller allegedly exploited his connections to his community and deceived retail investors into thinking the ATM investments were safe and reliable, when in reality he used only a fraction of investor funds to buy ATMs and misappropriated $185 million,” said Scott A. Thompson, Associate Director of Enforcement in the SEC’s Philadelphia Regional Office.
Legal Actions and Consequences
The SEC’s complaint, filed in the U.S. District Court for the Eastern District of Pennsylvania, charges Heller, Prestige, and Paramount with violations of the antifraud provisions of federal securities laws. The SEC is seeking:
- Permanent injunctions
- Disgorgement of ill-gotten gains with prejudgment interest
- Civil penalties against the defendants
- A conduct-based injunction and officer and director bar against Heller
In a parallel action, the U.S. Attorney’s Office for the Eastern District of Pennsylvania announced criminal charges against Heller. The SEC appreciates the assistance of the U.S. Attorney’s Office, the FBI, and the Internal Revenue Service.
