The SEC today announced that it obtained a final judgment against Thomas Megas for orchestrating a $1.4 million Ponzi scheme that defrauded at least 10 retail investors. As described in the court's opinion, Megas, a British national and Switzerland-based businessman, did not meet the burden for vacating the Court's initial ruling.

The final judgment, entered on the basis of default by U.S. District Judge Edward G. Smith in the Eastern District of Pennsylvania, permanently enjoins Megas from violating the registration provisions of Section 5 of the Securities Act of 1933 and the antifraud provisions of Section 17(a) of the Securities Act and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder and orders him to pay a combined total of $526,974 in disgorgement, prejudgment interest, and civil penalties.

The SEC's complaint, filed on March 24, 2020, accused Megas, together with co-defendant Todd H. Lahr, of targeting Lahr's clients to raise funds for several Megas-led business ventures, including mining operations in Papua New Guinea and real estate investments in Barcelona and London. Instead, Megas and Lahr allegedly used investor funds to pay earlier investors and for various personal expenses, including Megas' vacation to the Caribbean, restaurant bills, and ATM withdrawals.

Days after the entry of the final judgment on July 30, 2021, Megas filed a motion to vacate the Court's decision. On July 20, 2022, the Court denied Megas' action, concluding that Megas failed to present a meritorious defense or any evidence in support of his request to vacate the judgment against him. It also found that Megas willfully avoided timely action in this matter with his own testimony confirming that he knew about the SEC's litigation for one year before entry of the judgment.

Previously, the SEC obtained a final judgment against Lahr, and Lahr was sentenced to 78 months in prison in a parallel criminal action brought by the U.S. Attorney's Office for the Eastern District of Pennsylvania and the Fraud Section of the Department of Justice.

The SEC's investigation was conducted by Sonia Torrico, Jonathan Shapiro, and Cecilia Connor, with assistance from Donato Furlano, and supervised by Carolyn Welshhans and Amy Friedman. The SEC's litigation was led by Matthew Scarlato. The SEC appreciates the assistance of the Federal Bureau of Investigation, the Fraud Section of the Department of Justice, and the U.S. Attorney's Office for the Eastern District of Pennsylvania.