The U.S. Securities and Exchange Commission (SEC) charged Matthew Motil, host of the podcast “The Cash Flow King,” with fraudulently raising approximately $11 million from more than 50 investors in a Ponzi scheme involving notes purportedly backed by residential properties.
According to the SEC’s complaint, the Ohio-based Motil defrauded investors with promises of low-risk, high-return promissory notes purportedly collateralized by first mortgages on homes located throughout Ohio. Motil promoted the investments on his website, inviting potential investors to “be a real estate investing badass!,” and on his podcast where he claimed the investments were safe and backed by a “first lien position” on the underlying real estate assets. Motil told investors that he would pay the investors returns on their investments from profits from renovating, reselling, refinancing, and renting the properties.
However, the SEC stated Motil did not secure first lien positions for the investors and regularly sold multiple promissory notes he claimed were secured by the same property to multiple investors. In one instance, Motil allegedly sold more than $1 million of promissory notes to 20 investors, each note supposedly collateralized by the same property he had acquired for $47,000.
Rather than renovate the properties, Motil allegedly used investor money to make Ponzi payments to previous investors and for his own extravagant personal expenses, including to rent a lakeside mansion, purchase courtside season tickets to NBA games, and make $400,000 in credit card payments for his wife, Amy Motil, who is named as a relief defendant.
“We allege that Motil used podcasts and social media platforms to bolster his reputation as an investing expert while fraudulently targeting investors’ hard-earned retirement assets, including, in at least one instance, almost the full balance of an investor’s self-directed IRA,” said Mark Cave, associate director of the SEC’s Division of Enforcement. “We are committed to holding those who prey on others accountable for their unlawful conduct.”
The SEC’s complaint seeks injunctive relief, disgorgement plus prejudgment interest, civil money penalties, and an officer and director bar.
Photo of Matthew Motil from his X/Twitter account
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Glad to see they’re doing their job