Broward woman sentenced to 20 years for leading $190 million Ponzi scheme
Key Points(5)
- Garcia’s fraudulent enterprise operated from October 2020 to August 2021, during which she and co-conspirators, including Pavel Ramon Ruiz Hernandez, solicited money from investors under the pretense of funding merchant cash advances (MCAs)—short-term loans typically used by small businesses.
- According to court records, Garcia falsely claimed investor funds would generate profits through MJ Capital Funding’s MCA operations, but the company made minimal loans and failed to earn enough revenue to pay promised returns.
- Instead, Garcia used new investor money to pay earlier investors, a hallmark of a Ponzi scheme.
- Of the nearly $200 million raised, investors suffered losses totaling nearly $90 million, while Garcia misappropriated millions for personal use.
- Authorities also revealed that even after MJ Capital Funding was shut down by the FBI and Securities and Exchange Commission in 2021, Garcia launched a new fraudulent scheme using entities such as New Beginning Global Funding LLC and Lion Heart Capital Group LLC.
A Broward County woman who masterminded a massive Ponzi scheme that defrauded investors out of nearly $200 million was sentenced to 20 years in prison.
Johanna Michely Garcia, 41, the former CEO of MJ Capital Funding, LLC, pled guilty in July to conspiracy to commit mail and wire fraud in connection with the scheme.
Garcia’s fraudulent enterprise operated from October 2020 to August 2021, during which she and co-conspirators, including Pavel Ramon Ruiz Hernandez, solicited money from investors under the pretense of funding merchant cash advances (MCAs)—short-term loans typically used by small businesses. According to court records, Garcia falsely claimed investor funds would generate profits through MJ Capital Funding’s MCA operations, but the company made minimal loans and failed to earn enough revenue to pay promised returns.
Instead, Garcia used new investor money to pay earlier investors, a hallmark of a Ponzi scheme. Of the nearly $200 million raised, investors suffered losses totaling nearly $90 million, while Garcia misappropriated millions for personal use.
Authorities also revealed that even after MJ Capital Funding was shut down by the FBI and Securities and Exchange Commission in 2021, Garcia launched a new fraudulent scheme using entities such as New Beginning Global Funding LLC and Lion Heart Capital Group LLC. She continued the scam even while in federal custody.
Ruiz Hernandez, who pled guilty in April 2023 for his role in the fraud, was sentenced in September to 110 months in prison followed by three years of supervised release.
U.S. Attorney Markenzy Lapointe for the Southern District of Florida Special Agent in Charge Jeffrey B. Veltri, FBI Miami, and Russell C. Weigel, III, Commissioner, Florida Office of Financial Regulation (OFR) made the announcement.
