CHARLOTTE — A Charlotte man pleaded guilty for defrauding more than 100 people with a Ponzi scheme run through his investment firm.
Investigators said the victims lost more than $700,000 in the scheme.
Prosecutors said Frank Mercado, 26, and his business, Tiger-Wolf Capital, carried out the scheme from July 2019 to December 2022. Mercado’s victims included friends, former co-workers, and other acquaintances.
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Authorities said Mercado told his victims he was an expert in options trading and had a years-long successful track record. The Securities and Exchange Commission said earlier this month that he sold consumers about $1.4 million worth of unregistered securities, but only deposited about a tenth of the money in the brokerage account.
The agency said the defendants falsely told clients they were getting more than a 50% return on their investment, but used new investors’ money to pay old investors instead.
The SEC also claims Mercado spent about $37,000 of clients’ money on personal expenses and created bogus account statements to make it look like they were making a profit. Prosecutors said the same, adding that those personal expenses included credit card payments, Airbnb rentals, and restaurant and bar tabs.
Mercado lied to investors about how their investments were going, documents show.
Mercado pleaded guilty on Wednesday to wire fraud, which carries a maximum prison sentence of 20 years.
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