Fraudster's $364K Ponzi Scheme Funds Lavish Hotel Stays!

SEC v. Diana Mae Fernandez — U.S. Securities and Exchange Commission Litigation Release No. 26346, dated July 11, 2025.

Diana Mae Fernandez was found to have defrauded at least 20 investors out of approximately $364,000 between 2018 and 2020. She falsely claimed to offer no-risk, short-term investments but instead used the money for personal expenses and Ponzi-like payments. Fernandez has since been sentenced to 33 months in prison and ordered to pay restitution and forfeiture.

In Plain English

Imagine someone told you they had a secret way to make your money grow really fast with no risk, like a magic piggy bank. You give them your savings, but instead of investing it, they spend it on themselves, like buying fancy clothes or going on vacation. They might even use money from new people they trick to pay back the first people, like a house of cards. That's what happened here, and the person responsible is now facing jail time and has to pay back the money.

Disclaimer: all facts are drawn from the SEC's own filings; the claims described are allegations unless and until a court rules or the parties settle, and some cases end in dismissal.

How the Alleged Scheme Worked

1. The False Promise Between 2018 and at least 2020, Diana Mae Fernandez presented herself as a highly successful businesswoman with access to exclusive, no-risk, short-term investment opportunities. She promised investors that their money would grow quickly and safely.
2. Raising Funds Fernandez convinced at least 20 individuals to invest in her scheme, raising approximately $364,000 in total. Investors believed they were entrusting their money to a reliable and profitable venture.
3. Misappropriation of Funds Instead of investing the funds as promised, Fernandez diverted the investor money for her personal use. This included paying for her day-to-day living expenses.
4. Lavish Spending A significant portion of the investor funds was used for extravagant personal expenditures, such as funding numerous cash withdrawals and paying for lavish hotel stays, demonstrating a clear misuse of the capital entrusted to her.
5. Ponzi-Like Payments To maintain the illusion of a successful investment, Fernandez made payments to earlier investors using funds from later investors. This is a classic characteristic of a Ponzi scheme, where new money is used to pay off old debts.

The Enforcement Action

On July 10, 2025, the United States District Court for the Northern District of West Virginia entered a consent final judgment against Diana Mae Fernandez. The SEC's complaint, filed December 21, 2023, alleged that between 2018 and 2020, Fernandez defrauded at least 20 investors out of approximately $364,000 by touting false narratives of no-risk, short-term investments. Instead, she used investor funds for personal expenses, lavish hotel stays, cash withdrawals, and Ponzi-like payments. In a parallel criminal action, Fernandez pleaded guilty to wire fraud and was sentenced on March 27, 2025, to 33 months incarceration, three years supervised release, and ordered to pay $330,144 in restitution and $330,144 in forfeiture. Fernandez settled with the SEC, agreeing to injunctions against violating securities laws and offering/selling securities, and an order of disgorgement of $296,021, deemed satisfied by her criminal forfeiture. The SEC team included Christopher R. Kelly, Gregory R. Bockin, Michael F. McGraw, and Brendan P. McGlynn.

Named in this action: Diana Mae Fernandez.

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