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SEC Charges CEO and Company With Defrauding First Responders and Others Out of Millions


Washington D.C., July 30, 2020 —

The Securities and Exchange Commission today announced charges against a San Antonio-area businessman and his company for running a multimillion-dollar fraudulent scheme that victimized scores of investors, many of them retired San Antonio police officers and other first responders.

The SEC’s complaint alleges that Victor Lee Farias and his company, Integrity Aviation & Leasing (IAL), raised $14 million from investors, promising that they would use the funds to purchase engines and other aircraft parts for leasing to major airlines. As alleged, Farias and IAL falsely touted Farias’s supposed investment experience and IAL’s purported competitive advantages, such as an algorithm that supposedly identified profitable leasing opportunities, and represented that all investments would be secured by IAL’s assets. According to the complaint, many of the investors were retirees who, in order to invest their retirement funds, had to withdraw the funds from their retirement accounts and deposit them in newly created self-directed IRA accounts. The complaint alleges that IAL never purchased any engines and spent only a small portion of investor funds on aircraft parts. Farias and IAL allegedly diverted more than $11.6 million for unauthorized purposes, such as making $6.5 million in Ponzi-like payments to investors and investing $2.7 million to fund a friend’s business. Farias also allegedly misappropriated $2.4 million for personal expenses. According to the complaint, Farias continued to mislead investors after he learned of the SEC’s investigation, including by using the letterhead from the SEC’s investigative subpoena as “proof” for investors that he was working with the SEC to take IAL public.

“As we allege, Farias encouraged his victims to invest their hard-earned retirement nest eggs into his fraudulent business,” said David Peavler, Regional Director of the SEC’s Fort Worth Office. “Investors should always proceed cautiously whenever someone suggests moving funds from traditional retirement accounts to self-directed IRAs in order to make an investment.”

The SEC’s Office of Investor Education and Advocacy previously issued an investor alert on the risks associated with use of self-directed IRAs.

The SEC’s complaint charges Farias and IAL with violating antifraud and securities registration provisions of the federal securities laws. The complaint seeks injunctive relief, disgorgement plus prejudgment interest, and civil penalties.

The SEC’s investigation was conducted by Rebecca Fike, Kendrea Tannis, Melvin Warren, and Ty Martinez under the supervision of Scott Mascianica and Eric Werner of the Fort Worth Regional Office. The SEC’s litigation is being led by Janie Frank and supervised by B. David Fraser.


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