John Bravata, the chairman of BBC Equities, LLC, was arrested in New York City on May 5th as he exited a plane returning from Italy. Bravata now faces criminal charges for a Michigan investment scam in which he allegedly took $50 million from 440 different investors. Previously, only one civil claim had been filed.
Bravata, whose company has been called the "Billionaire Boys Club" by authorities, has now been charged with wire fraud. Although the criminal complaint does not specifically mention the civil complaint's Ponzi scheme, he is accused of misleading investors regarding how their money would be invested, the returns expected, and how secure their money actually was. He is also accused of lying about how much money he would personally make in the deal.
In the previous civil complaint, the SEC said Bravata used investors' money for cars, boats, cosmetic surgery, and his luxury home. He is also said to have used money from new investors to pay off prior investors. The criminal complaint alleges he used less than half of the $50 million to actually invest.
Prosecutors alleged that Bravata fled to Italy to avoid charges, and that he had been in Italy for a while. Prosecutors want Bravata to be detained in NYC as a flight risk. His assets have been frozen and he is under a restraining order.