SEC, DOJ Charge Defendants With Over $200 Million Water Vending Machine Ponzi Scheme

Founder and Owner of Washington-Based Water Machine Manufacturer and Two Companies Charged in $275 Million Fraud Scheme

The Securities and Exchange Commission today charged Ryan Wear, of Marysville, Washington, and his entities, Water Station Management LLC and Creative Technologies, Inc., for operating two related Ponzi-like schemes between September 2016 and February 2024 that raised more than $275 million from more than 250 investors. In a separate action, the SEC also charged portfolio manager Jordan Chirico, of Carmel, Indiana, for violating his fiduciary duty by investing his private fund client in the scheme despite his undisclosed conflicts of interest and awareness of red flags. […]

The SEC’s complaint against Wear, Water Station, and Creative Technologies alleges that from September 2016 through September 2023, these defendants raised more than $165 million, primarily from retail investors including veterans, by offering and selling investment contracts in which investors supposedly purchased water machines that would generate revenues. In reality, the complaint alleges, thousands of the water machines did not exist or had already been sold to other investors. The complaint further alleges that in a second, related scheme, these defendants raised more than $110 million from institutional investors between April 2022 and February 2024 through the issuance of Water Station notes purportedly secured by water machines. As with the first scheme, most of the water machines did not exist or were not owned by Water Station, according to the complaint. These defendants also allegedly misappropriated over $60 million of investor funds to make Ponzi-like payments to other investors and fund Wear’s other business ventures, including Refreshing USA, LLC and Ideal Property Investments LLC, which are named in the complaint as relief defendants.  

SEC Sues Investor Relations Director, Friends for Insider Trades

A managing director of an investor communications firm that assists pharmaceutical and biotechnology companies tipped off two friends who traded on nonpublic information to yield more than half a million dollars in illicit proceeds, the SEC alleged.

Robert Yedid shared details including drug trial results and other key financial information with Andrew Kaufman and Mark Jacobs in exchange for kickbacks, the Securities and Exchange Commission said in a complaint filed Thursday in the US District Court for the Southern District of New York.

The Big Law Firms Hiring Government Lawyers

The last year has brought a flood of government attorneys into the lateral market, with many Big Law firms scooping up high-level talent from federal agencies.

But some law firms have been more active than others in adding lawyers who served during the Biden administration. In particular, the law firms that have been targeted by the Trump administration, including Wilmer Cutler Pickering Hale and Dorr; Jenner & Block and Covington & Burling, were among the firms that hired the most government attorneys since December 2024, according to data tracked by Surepoint (which acquired Leopard Solutions last year).

Other firms with frequent government lateral additions from the Biden administration include litigation boutique Hecker Fink; Gibson Dunn & Crutcher; Latham & Watkins; Arnold & Porter Kaye Scholer; and Kirkland & Ellis. (Kirkland and Latham each made a pro bono deal with President Donald Trump in April.)

Bitcoin News: Strategic Reserve Purchases May Still Be in Play

Treasury Secretary Scott Bessent began Thursday by dashing the hopes of at least some bitcoiners, saying the Strategic Bitcoin Reserve would be made up of the $15 billion to $20 billion already held by the government, but that there was no intention of making any fresh purchases.

He ended the day, however, by seemingly contradicting those remarks, saying his department is “committed to exploring budget-neutral pathways to acquire more Bitcoin to expand the reserve.”