The Securities & Exchange Commission today announced charges against Mexico-based company Aras Investment Business Group S.A.P.I. de C.V., its CEO Armando Gutierrez Rosas, & four individuals for fraudulently raising at least $15 million from more than 450 retail investors in the U.S., most of whom were members of the Mexican American community.
The SEC’s complaint, filed in U.S. District Court for the Western District of Texas, alleges that, from about March 2020 through November 2021, Gutierrez raised money from retail investors in the U.S. for the purported purpose of investing in U.S. real estate & mining operations in Mexico, promising investors monthly returns as high as 10 percent. According to the complaint, no U.S. investor funds were used for investment purposes; instead, Gutierrez was operating a Ponzi scheme & affinity fraud & used investor funds to pay for his personal expenses including a $2.5 million mansion in Texas. Along with Gutierrez, the SEC also charged Efren Quiroz, Luis Quiroz, Maria Tolentino, & Diayanira Rendon for their roles in the alleged fraud.
“Our investigation uncovered this egregious fraud that cost the investors involved more than $6 million,” said Melissa R. Hodgman, Associate Director in the SEC’s Division of Enforcement. “We are committed to holding promoters of these types of affinity frauds accountable.”
The SEC’s complaint charges Gutierrez & Aras with violating the antifraud & registration provisions of the federal securities laws; charges Efren & Luis Quiroz with acting as unregistered brokers &, along with Tolentino, with violating the registration provisions & aiding & abetting Gutierrez’s & Aras’s violations of the antifraud provisions; it also charges Rendon with aiding & abetting Gutierrez’ & Aras’ violations of the antifraud provisions. The SEC’s complaint seeks permanent injunctions, civil penalties, & disgorgement with prejudgment interest.
Without admitting or denying the allegations in the complaint, Efren & Luis Quiroz, Tolentino, & Rendon consented to the entry of judgments against them as to all claims, including full injunctive relief against future violations, with disgorgement & penalties to be determined by the court upon motion by the Commission. The settlements are subject to court approval. Efren & Luis Quiroz also consented to settled Commission orders barring each of them from association with a registered entity or participation in a penny stock offering.
The SEC’s Office of Investor Education & Advocacy has issued an Investor Alert with tips on how investors should avoid investment decisions based solely on common ties with someone recommending or selling the investment.
The SEC’s investigation was conducted by Stephen T. Kaiser, with assistance from Margaret Vizzi. Melissa Armstrong & Mr. Kaiser will lead the SEC’s litigation. The SEC’s investigation was conducted by Stephen T. Kaiser, with assistance from Margaret Vizzi. Mr. Kaiser will lead the SEC’s litigation. The case was supervised by Tim England, Melissa Armstrong, & Ms. Hodgman.