U.S. SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 25878 / October 3, 2023
Securities and Exchange Commission v. Zera Financial LLC, Luis A. Romero, aka Luis A. Romero-Navarette, aka Luis A. Romero-Navarrete, Case No. 8:23-cv-01807-CJC-(ADSx)(C.D. Cal. filed September 27, 2023)
SEC Shuts Down Zera Financial LLC Offering Fraud
The Securities and Exchange Commission obtained an emergency order to halt an alleged ongoing offering fraud and Ponzi-like scheme by Zera Financial LLC (Zera) and its owner, Luis A. Romero, who have raised more than $2.2 million from about 170 investors.
As alleged in the SEC’s complaint, through a public website, a mobile application, an Instagram account, and word of mouth, Zera and Romero promised investors 3% monthly returns—amounting to more than 36% annual returns—on investments of as little as $500. As alleged, Zera and Romero went beyond these incredible monthly returns and falsely represented that investments in Zera were FDIC insured. The complaint also alleges that Romero falsely posed as a Zera investor in an online forum to quell concerns that Zera’s returns were too good to be true. The complaint further alleges that Zera has no meaningful business apart from raising money and making Ponzi-like payments to investors. Moreover, as alleged in the complaint, Romero misappropriated and commingled investor funds with his own. The complaint alleges that Romero has deposited hundreds of thousands of dollars in various crypto asset accounts held in his name and has spent hundreds of thousands of dollars on personal expenses, including an electric truck, rent, and even tropical fish.
The court granted the SEC emergency relief against Zera and Romero, including a temporary restraining order and an order freezing assets. A hearing is scheduled for October 11, 2023, to consider whether to issue a preliminary injunction.
The SEC’s complaint, filed in federal court in the Central District of California, charges the defendants with violating the antifraud provisions of Section 17(a) of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder, and seeks permanent injunctions, conduct-based injunctions, disgorgement with prejudgment interest, civil penalties, and also against Romero, an officer and director bar.
The SEC’s investigation was conducted by Michael J. Simeone, Maria D. Rodriguez and Anne C. Romero and supervised by Victoria A. Levin. The litigation will be led by Charles E. Canter and supervised by Gary Y. Leung.
The SEC appreciates the assistance of the Federal Deposit Insurance Corporation (FDIC).