SEC Settles With Bonanza Global Co-Founder Over Alleged $5 Million Ponzi Scheme
SEC charges Francisco Javier Sarabia over Bonanza Global's alleged $5 million Ponzi scheme, with $825,000 disgorgement and a proposed securities offering ban.
Summary
The SEC filed settled charges on September 8, 2026, against Francisco Javier Sarabia, a Tustin, California resident and president and co-founder of Bonanza Global Solutions Limited Liability Company. The complaint, SEC v. Francisco Javier Sarabia, No. 26-civ-02542 in the Central District of California, alleges Sarabia and a business partner raised more than $5 million from over 350 Spanish-speaking and Filipino investors between approximately February 2022 and March 2023. They allegedly portrayed Bonanza Global as a hedge fund, promised monthly returns of 10% to 15% or more and a money-back guarantee, and claimed funds would finance stock trading and other investments.
The SEC alleges Bonanza Global generated no revenue, while Sarabia used investor money for luxury purchases, travel and payments to earlier investors in a Ponzi-like structure. The complaint charges violations of Securities Act Sections 17(a), 5(a) and 5(c), Exchange Act Section 10(b), and Rule 10b-5. Subject to court approval, Sarabia consented to permanent antifraud and registration injunctions, a conduct-based ban on participating in securities offerings, $825,000 in disgorgement and $215,137 in prejudgment interest.
Teri Melson and Maria Rodriguez conducted the SEC investigation under Finola H. Manvelian in the Los Angeles Regional Office. Ruth Pinkel will lead the litigation under Stephen Kam, with assistance from the U.S. Attorney’s Office for the Central District of California and the FBI.
Positives
- Sarabia consented to $825,000 in disgorgement and $215,137 in prejudgment interest, subject to court approval.
- The proposed final judgment would permanently enjoin Sarabia from violating the charged federal securities provisions.
- A conduct-based injunction would prohibit Sarabia from participating in securities offerings.
- The SEC coordinated with the FBI and the U.S. Attorney’s Office for the Central District of California.
Risks & concerns
- More than $5 million was allegedly raised from over 350 investors between approximately February 2022 and March 2023.
- Spanish-speaking and Filipino investors were allegedly targeted with promised monthly returns of 10% to 15% or more.
- Bonanza Global allegedly generated no revenue despite claims that investor funds would support stock trading and other investments.
- Sarabia allegedly spent investor funds on luxury items and travel while paying earlier investors in a Ponzi-like fashion.
- The proposed $825,000 disgorgement is substantially below the more than $5 million allegedly raised, and the release specifies no investor restitution amount.
- All proposed injunctions and monetary remedies remain subject to court approval.
