Since 2021, McGuireWoods’ Ponzi Litigation team has used the Ponzi Perspectives blog to track Ponzi-related complaints in federal and state courts, analyze key decisions affecting claims against financial institutions, and provide practical guidance for institutions facing suits from defrauded investors, receivers, and trustees. Ponzi litigation continues to proliferate with numerous complaints filed across dozens of federal district and state courts in the first three months of 2026 alone, driven both by smaller schemes and larger schemes spawning a constellation of related lawsuits. Our Q1 2026 roundup covers the quarter’s cases, emerging trends, and highlights anticipated trends for the remainder of the year.

Government Enforcement and Receiver Actions Continue to Account for a Significant Portion of Ponzi Litigation

SEC and State Enforcement Actions

Government enforcement actions continue to play a significant role in Ponzi litigation, often serving as the catalyst for subsequent civil litigation. Notably, this month the SEC announced its enforcement results for fiscal year 2025, reporting 456 total enforcement actions—including 303 standalone actions—and obtaining orders for monetary relief totaling $17.9 billion. The SEC characterized fiscal year 2025 as a period of significant transition, marked by a deliberate focus on cases involving fraud, market manipulation, and abuses of trust that directly harm investors. This shift is expected to directly impact civil actions as victims find additional avenues for relief.

Among the noteworthy fiscal year 2025 actions, the SEC highlighted several Ponzi scheme cases, including an action against Paramount Management Group and its founder for a scheme that allegedly defrauded approximately 2,700 investors and caused $400 million in losses. The SEC also emphasized a renewed focus on holding individual wrongdoers accountable, noting that approximately two-thirds of standalone actions involved charges against individuals—a 27 percent year-over-year increase—and that nearly nine out of every ten standalone actions filed involved individual charges.

These enforcement priorities are consistent with the broader Q1 2026 landscape, where government enforcement actions against individual bad actors continue to spur private civil litigation. For example, the SEC filed an enforcement action against defendant Marco Santarelli in October 2025, charging him with operating a Ponzi-like scheme, and Santarelli consented to the entry of judgment admitting violations of various federal securities laws.  This action directly spurred a wave of private civil litigation during Q1 2026, with numerous investor groups from at least ten states filing complaints asserting claims for violations of Section 10(b) of the Exchange Act, state securities law violations, fraud, breach of fiduciary duty, and other causes of action.  Several of the civil complaints explicitly reference the SEC Consent Judgment and Santarelli’s guilty plea as foundational allegations. 

Receiver Clawback Actions

Receivers appointed in the wake of earlier government enforcement actions also continued to seek recoupment for defrauded investors this quarter. For example: in the Northern District of Texas, the court-appointed receiver in the Agridime LLC matter filed suit against multiple “net winner” investors who received returns exceeding their principal investments. Agridime allegedly had raised approximately $191 million from more than 2,100 investors by selling investment contracts related to the purported purchase, feeding, and sale of cattle, promising guaranteed annual returns of 15% to 32%.

Q1 2026 Subject Matter Trends: Cryptocurrency, Promissory Notes, Retirement Assets, and Real Estate

Cryptocurrency

As in prior years, cryptocurrency continues to dominate Ponzi-related litigation, and Q1 2026 has proven to be particularly prolific in this area, involving schemes with purported investor losses in the hundreds of millions. One example of a crypto-related scheme arose in a complaint filed in the Middle District of Tennessee against defendants Brock Pierce and Scott Walker, alleging the defendants enriched themselves at investors’ expense by running pump-and-dump schemes involving meme coins and other worthless cryptocurrency projects, including promoting tokens, engaging in illegal gambling, and intentionally destroying their own business to avoid sharing money with investors.

However, the approach to crypto-related enforcement actions brought by the SEC is likely to shift in 2026.  In 2025, the SEC dismissed several prior crypto-related enforcement, describing that shift as a “necessary course correction.”  Nevertheless, the SEC has stated that it remains “committed to detecting, deterring, and bringing actions against those seeking to take advantage of investors by misusing new technologies.” In February 2025, the SEC announced the launch of the Cyber and Emerging Technologies Unit to complement the work of the Crypto Task Force and to protect investors.

Promissory Notes, Retirement Assets, and Self-Directed IRAs

The “classic” promissory note scheme also remains a significant source of litigation, as evidenced by the numerous Norada Capital scheme complaints. That scheme allegedly involved the sale of unregistered promissory notes offering 12%–17% returns with “bonus payments,” marketed as “predictable income” and “monthly passive income” through online channels including YouTube webinars and podcasts. Several plaintiffs invested through IRA accounts, with the Norada Capital scheme marketed as compatible with self-directed IRAs.  Investors from ten different states filed complaints against Norada Capital, claiming that they invested amounts ranging from $100,000 to $1.8 million in promissory notes issued by the firm and were subsequently defrauded.  Also, in September 2025, Norada principal Santarelli was charged by federal prosecutors with one count of wire fraud based on the alleged scheme. Santarelli pleaded guilty to the charge in October 2025, and his sentencing is scheduled for August 2026, according to the court docket.

Real Estate

Real estate and construction schemes also continued to appear this quarter. In Lee County, Florida, a complaint was filed alleging that a construction company operated a fraudulent Ponzi scheme, taking deposits from homeowners to fund expenses on earlier projects and diverting customer funds, while fraudulently using another person’s general contractor license. In King County, Washington, a complaint alleged that an individual used complex, layered shell companies to solicit investments in purported real estate development projects, obscuring ownership and dissipating investor funds. Additionally, in the Eastern District of Texas, a complaint was filed alleging fraud and misappropriation of escrow funds in connection with a commercial real estate medical office building project that operated as a Ponzi scheme.

Foreign Exchange and Trading

Foreign exchange and trading schemes also made an appearance this quarter. In Miami-Dade County, a complaint was filed against individuals and entities alleging a Ponzi-style investment fraud scheme marketed as a sophisticated Forex and quantitative trading operation, promising monthly returns of 6% to 15% while limiting trading exposure to only a portion of pooled assets, when in reality the scheme was allegedly a classic Ponzi operation that misrepresented its trading strategies and liquidity.

Types of Plaintiffs and Defendants in Q1 2026

The types of plaintiffs filing Ponzi-related complaints in Q1 2026 were diverse. Individual defrauded investors and their associated entities, including LLCs, trusts, and IRA beneficiaries, comprised the largest group of plaintiffs. Several complaints were brought as putative class actions on behalf of broad classes of investors. Government agencies, including the SEC and state securities divisions, continued to bring enforcement actions. Court-appointed receivers also played a prominent role, filing clawback actions against “net winner” investors and other transferees.

As for defendants, Q1 2026 saw claims brought not only against the schemers themselves and their corporate vehicles, but also against third-party facilitators. For example, financial institutions were named as defendants in facilitation claims alleging aiding and abetting fraud and negligence, often alleging that the bank profited from the scheme by collecting fees and interest tied to the schemers’ accounts. Individual schemers, their family members, corporate officers, and those who purportedly facilitated schemes through the use of professional licenses were also named.

***

McGuireWoods looks forward to continuing to document the legal landscape in civil and criminal Ponzi litigation in Ponzi Perspectives throughout the remainder of 2026.  As always, if you have any questions about these issues or our blog, please reach out to a member of the Ponzi Litigation team.