You know what the SEC likes more than Lamborghinis? Nailing Tai Lopez for (alleged) investor fraud.

One of YouTube‘s original finance gurus is being sued by the Securities and Exchange Commission (SEC) for $112 million over allegations his recent ecom venture was at least partially a Ponzi scheme.

Lopez has been on YouTube for over a decade, and was one of the original voices in the whole “hustle bro” movement, telling wannabe entrepreneurs that if they wanted to become millionaires, buy their own Lamborghinis, and “get things done and stop sucking your thumb,” they should drop hundreds or thousands of dollars on his how-to courses* (*results not guaranteed).

You may remember that back in 2020, during the height of the whole NFT craze, Lopez and Zoosk co-founder Alex Mehr joined forces on a holding company called Retail Ecommerce Ventures (REV). The idea was to buy legacy brick-and-mortar brands that were “distressed” (aka on the verge of or already in active bankruptcy), close down all their retail locations, and turn them into trendy ecom destinations. REV also, like many guru-run businesses at the time, had vague crypto and NFT ambitions. (Those gurus, including Lopez and Mehr, have mostly moved on to AI; Lopez just posted this video, and Mehr says he now runs businesses called “Famous.ai” and “Deal.ai.”)

Among REV’s acquisitions were Radio Shack, Pier 1 Imports, Dressbarn, and Modell’s Sporting Goods.

To finance these acquisitions, Lopez, Mehr, and Lopez’s cousin/REV’s COO Maya Burkenroad brought in investors. They ran splashy ads talking up Mehr’s sale of Zoosk and promising investors they’d get all their money back in monthly installments. One ad said that for every $300K investors put in, they’d get $60,000 back per year—a return so immediate and so high it’s virtually unheard of.

The SEC’s suit alleges that in pitches to investors, Lopez, Mehr, and Burkenroad said REV’s various companies were “on fire” and that “cash flow is strong.”

But that wasn’t actually true.

“Contrary to these representations, while some of the REV Retailer Brands generated revenue, none generated any profits,” the suit alleges. “Consequently, in order to pay interest, dividends and maturing note payments, Defendants resorted to using a combination of loans from outside lenders, merchant cash advances, money raised from new and existing investors, and transfers from other portfolio companies to cover obligations.”

(The SEC says REV also misrepresented one more thing: Burkenroad’s experience. While Lopez and Mehr claimed she had “over 10 years of experience managing multi-million-dollar companies,” she actually worked as a substitute preschool teacher, a promoter at a radio statio, and as Lopez’s assistant.)

It’s worth noting that while all this (alleged) fraud was (allegedly) happening, REV’s rebranding efforts weren’t going well. With Radio Shack, for example, the REV team tried getting digital denizens’ attention by filling its social accounts with crude, sexist, R-rated posts that had people wondering whether they’d been hacked. The posts did get attention, but marketing experts agreed it wasn’t the kind of attention that would turn Radio Shack into the booming ecom brand REV wanted.

While REV raised around ~$230 million total, ‘only’ around $112 million was raised through fraudulent means, per the SEC’s suit, and $5.9 million of investor payments were made through Ponzi means.

The suit also alleges Lopez and Mehr spent $16 million of investors’ money for personal use, and mentions that investors were told funds allocated for a particular brand would not be moved around to REV’s other assets. The SEC says this is not true, and that money was frequently swapped between accounts.

Scambusting YouTuber Scott Shafer has been making videos about Lopez, Mehr, and REV for years, and had access to an investor chat group. In a new upload, he said REV’s investors formed their own organization and now have control of all the brands previously owned by REV; Lopez, Mehr, and Burkenroad are no longer involved with them. This arrangement, Shafer said, kept investors from suing Lopez and Mehr.

But the SEC wasn’t part of that settlement, and now it’s on their trail for fraud.

Former employees told The New York Post that they were the ones who tipped off the SEC in 2023.

“We have been trying to get someone to expose Tai Lopez and his gang of fraudsters for a long time,” one said. Another former REV executive, who resigned after working there a short time, added, “I felt I’d be compromising myself by continuing to work there. It’s possible that I witnessed something illegal. I’ve never worked for a company promising to pay investors 20% and chartering jets and flying all over the country.”

The suit was filed Sept. 22 in the U.S. District Court for the Southern District of Florida. Lopez, Mehr, and Burkenroad have not issued official comments or publicly recognized the SEC’s allegations in any way.

Lopez, however, has been tweeting through it.

“Never doom,” he wrote Sept. 24. “No matter how horrible the situation, don’t ever think you’re doomed. Unless you are dead, all defeat is psychological.”