SANTA ANA, Calif. (AP) – A former Southern California man was accused on Wednesday of running a “boiler room” program that defrauded more than 100 investors out of $ 14 million.
Ronald Shane Flynn, who once lived in Orange County, has been indicted by a federal grand jury with 15 counts of wire fraud, the county attorney’s office said in a statement.
Flynn, 57, allegedly left the United States more than a decade ago, according to the district attorney’s office, which declined to comment on where he lives.
Flynn ran Vuuzle Media Corp., which claimed to be a media and entertainment streaming company with offices in New York City, Las Vegas, and around the world.
Prosecutors alleged that as of September 2016, the company offered what it claimed was an opportunity to invest in the business ahead of its initial public offering, prosecutors said.
Although he was not licensed to offer securities in California and also Ohio, Flynn led the scheme while operating from the Philippines, Dubai and elsewhere, according to the indictment.
Flynn commissioned a “boiler room” of vendors, mostly based in the Philippines, who used high-pressure tactics to solicit around $ 14 million from investors, according to the indictment and a lawsuit filed in January in New Jersey by the United States Securities and Exchange Commission.
According to the indictment, Vuuzle never made a profit, Flynn never paid dividends to investors and never intended to take the company public.
Only a small percentage of the funds were actually spent on the streaming business, authorities said.
Instead, according to the SEC lawsuit, around $ 5.5 million was used to pay commissions and expenses for the recruiting effort, while Flynn used nearly $ 5 million to fund a luxury lifestyle that included buying jewelry and paying for resort stays and nightclub visits.
If convicted of the criminal charges, Flynn could face a sentence of up to 300 years in federal prison.