SEC[1] and DOJ[2] Bring Parallel Actions in $275 Million Ponzi Schemes Involving Water Vending Machines There has not been much news regarding SEC enforcement lately, but today the SEC and DOJ both charged a founder of a Washington-based water vending machine manufacturer Water Station Management, LLC and two related companies for perpetrating two separate, albeit related, Ponzi schemes. This is not what Michael Burry meant when he said he was investing in water.
On December 20, 2021, the SEC[1] and DOJ[2] each announced fraud charges against five Russian nationals. The five defendants are charged with a multiyear scheme of hacking into service providers that help public companies make quarterly and annual filings with the SEC through the EDGAR filing system. By hacking the service providers, the defendants allegedly obtained material nonpublic information (MNPI) regarding earnings releases before those releases were made public. The defendants then allegedly traded ahead of the release of the MNPI, reaping profits of some $82 million in the process.
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