MILLIONS VANISH AS PROMOTER RUNS PONZI SCHEME!

SEC v. Marco G. Santarelli — U.S. Securities and Exchange Commission Litigation Release No. 26420, dated November 19, 2025.

The SEC charged Marco G. Santarelli for orchestrating a multi-million-dollar investment scheme through his company, Norada Capital Management. Santarelli allegedly defrauded hundreds of investors nationwide by selling unsecured, high-yield promissory notes that he falsely claimed had strong capital preservation. In reality, the investments were volatile, and by August 2023, Santarelli began using new investor funds to pay promised returns, operating a Ponzi scheme that eventually collapsed, leading to investor losses.

In Plain English

Imagine someone promising you a really good return on your savings, like getting 15% interest every year, and saying your money is super safe. But instead of actually investing your money wisely, they take money from new people who give them money and use that to pay the older investors. This is called a Ponzi scheme. Eventually, they run out of new people, and everyone loses their money. That's what happened here.

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. Promising High Returns and Safety From June 2020 to June 2024, Marco G. Santarelli, through Norada Capital Management, LLC, offered investors unsecured, high-yield promissory notes. Santarelli falsely assured investors that these notes had 'strong capital preservation potential' and were suitable for retirement.
2. Misrepresenting Investments Santarelli claimed Norada would invest in assets with 'high cash-flow or future cash-flow potential.' In reality, Norada's portfolio consisted of volatile and speculative investments that did not generate the promised returns.
3. Starting Ponzi Payments By August 2023, Norada's investments could no longer satisfy the promised returns. Santarelli began using funds from new investors to pay returns to earlier investors, a practice known as a Ponzi scheme, without disclosing this to investors.
4. Increasing the Stakes Despite the scheme's reliance on Ponzi payments, Santarelli aggressively solicited more funds. In August 2023, he offered investors a 5% bonus on top of their existing high rates (12-17% annually).
5. Raising More Funds This aggressive solicitation and bonus offer proved effective, allowing Norada to raise an additional $10.4 million from investors in August 2023 alone. Over the next ten months, Norada raised an additional $43 million.
6. Scheme Collapse The Ponzi scheme eventually collapsed under its own weight. In June 2024, Santarelli notified investors that Norada was suspending all distribution payments.
7. Issuing Equity Instead of Debt As part of the suspension, Santarelli offered investors equity in Norada in place of their debt obligations, a move that did not compensate them for their losses.
8. Ceasing Operations By early 2025, Norada Capital Management, LLC, ceased all operations, leaving many investors unable to recover their invested funds.

The Enforcement Action

On October 20, 2025, the SEC charged Marco G. Santarelli in the U.S. District Court for the Central District of California with operating a fraudulent multi-million-dollar investment scheme through Norada Capital Management, LLC. Santarelli allegedly defrauded hundreds of investors nationwide by selling unsecured, high-yield promissory notes that were falsely described as safe. The SEC's complaint alleged that from June 2020 to June 2024, Santarelli raised tens of millions of dollars, and by August 2023, began making Ponzi-like payments. In June 2024, Santarelli suspended payments, and Norada ceased operations by early 2025. Santarelli, without admitting or denying the allegations, consented to a final judgment permanently enjoining him from violating antifraud and registration provisions, imposing a conduct-based injunction, and ordering him to pay a penalty, disgorgement, and prejudgment interest. In a parallel action, Santarelli pleaded guilty to criminal charges brought by the U.S. Attorney’s Office for the Central District of California.

Named in this action: Marco G. Santarelli.

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