SEC Charges California Attorney for Role in $910 Million Ponzi Scheme
Litigation Release No. 25544/ September 30, 2022
Securities and Exchange Commission v. Ari Lauer, No. 2:22-CV-01726 (E.D.Cal. filed September 30, 2022)
The Securities and Exchange Commission today announced charges against Ari J. Lauer, an attorney for DC Solar Solutions, Inc. and DC Solar Distribution, Inc. (together "DC Solar"), for his role in a multi-year alternative energy tax credit Ponzi scheme run by the two California-based companies.
According to the SEC's complaint, filed in federal court in Sacramento, Lauer served as the outside general counsel for DC Solar. Lauer is alleged to have been an important participant in a massive Ponzi scheme that raised over $910 million from investors between 2011 and 2018. The complaint alleges that Lauer helped obtain investments in securities issued by DC Solar that purportedly delivered gains in the form of tax benefits, guaranteed lease payments, and additional profits from the leasing of mobile solar generators. In reality, the complaint alleges, thousands of the purportedly profitable generators were never even manufactured, let alone put into use, and the vast majority of revenue to existing investors came from funds from new investors.
Lauer is alleged to have created misleading transaction documents and provided false information about purported leases to investors, in order to hide the lack of legitimate lease revenue from them. According to the complaint, Lauer made millions of dollars from the scheme, while investors lost their money.
The SEC's complaint charges Lauer with violating the antifraud provisions of the federal securities laws and seeks injunctive relief, disgorgement, and civil penalties.
The SEC's investigation was conducted by Sarra Cho and supervised by Armita Cohen and Osman Nawaz, all of the SEC's Complex Financial Instruments Unit, with the assistance of Kam Lee. The litigation is being led by Dean M. Conway and supervised by Melissa Armstrong.