Siddharth Jawahar Indicted for Running a Multi-Million Dollar Ponzi Scheme
On December 21, 2023, Siddharth Jawahar, 36, a former investment advisor, was indicted by a grand jury in U.S. District Court in St. Louis on three counts of wire fraud and one count of investment adviser fraud. The indictment was sealed until Monday, when the FBI arrested Jawahar in Miami, Florida. The government is seeking to have Jawahar held in jail until trial.
According to the Indictment, Jawahar is accused of running a Ponzi scheme that cost investors tens of millions of dollars through a Texas-based investment company called Swiftarc Capital LLC. From July 2016 through roughly December 2023, Jawahar took in more than $35 million from Swiftarc investors but spent about $10 million on investments in companies. Jawahar used the money from new investors to repay older investors and to fuel an extravagant lifestyle that included flights on private planes, stays at luxury hotels and expensive outings at lavish restaurants.
Swiftarc had initially invested in a diverse array of securities, but in 2015, Jawahar began investing the majority of client funds in a single investment, Philip Morris Pakistan (PMP). Eventually, 99% of client funds were consolidated into the PMP investment, the indictment says. Jawahar did not inform investors of a dramatic decline of the value of PMP, instead falsely representing to investors that shares were trading at a much higher price, it says, and misleading investors about their profits.
The indictment accuses Jawahar of misleading someone in eastern Missouri into believing that a series of investments totaling $175,000 would go into specific companies. A New York investor was told the same about $350,000 and an Ohio investor heard the same about $250,000, the indictment says.
On June 7, 2022, the Texas State Securities Board revoked Swiftarc Capital’s authority to conduct investment activities and ordered Jawahar to “cease and desist from engaging in fraud.” The indictment says Jawahar did not notify investors about that cease-and-desist order before taking their money and continued to fraudulently solicit and receive investor funds, including $1 million from an investor weeks after the state board’s order.
The wire fraud charges are each punishable by up to 20 years in prison and a $250,000 fine, or both. The investment adviser fraud charge is punishable by up to five years in prison and a $10,000 fine, or both.
To speak with a Securities Attorney, please contact Brenda Hamilton at 200 E Palmetto Rd, Suite 103, Boca Raton, Florida, (561) 416-8956, or by email at [email protected]. This securities law blog post is provided as a general informational service to clients and friends of Hamilton & Associates Law Group and should not be construed as and does not constitute legal advice on any specific matter, nor does this message create an attorney-client relationship. Please note that the prior results discussed herein do not guarantee similar outcomes.
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