Tai Lopez, the famous YouTuber behind the viral “Here in My Garage,” is now in turmoil. The SEC accuses him of orchestrating a Ponzi scheme.
The “Here in My Garage” Phenomenon
For those who weren’t on YouTube a decade ago, it might seem crazy, but this bespectacled man, his Lamborghini, and his library were absolutely unavoidable around 2015. The “here in my garage” pre-roll ad appeared on what seemed like every YouTube video at the time and was referenced and parodied everywhere. He resurfaced in the news this week, and the news isn’t good.
Tai Lopez’s YouTube Activity
Tai Lopez, the guy in the video proclaiming to be prouder of his books than his Gallardo, is a financial advice YouTuber. His channel still has a substantial following but relatively few views on recent posts. He’s definitely still active, having posted a new video just a week ago.
The SEC’s Accusations
Last Friday, the U.S. Securities and Exchange Commission charged Tai Lopez and Alexander Mehr, co-founders of Retail Ecommerce Ventures LLC, along with its operating director Maya Burkenroad, with conducting a series of fraudulent securities offerings, misappropriating investor funds, and making Ponzi-like payments to investors.
As reported, through their holding company, Mehr and Lopez acquired struggling businesses to turn them into online-only brands. Dress Barn and Linens ‘n Things were among their acquisitions. At least, that was the publicly promoted version of the operation.
The Details of the Fraud
The official SEC complaint filed in a Florida court reveals that Lopez and his associates raised about $112 million from hundreds of investors through fraudulent offerings, transferred money between investors to make them believe they were receiving dividends, and misappropriated approximately $16.1 million of investor funds for the personal use of Lopez and Mehr.
Lopez and Mehr are now charged with violations of Section 17(a) of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934. The courts will then decide their future.