Business ProfileforMBIG Corporation
Investment Advisory Services
Current Alerts For This Business
Government Action:
The following describes a government action that has been resolved by either a settlement or a decision by a court or administrative agency. If the matter is being appealed, it will be noted below.
April 1, 2019 The following describes a Complaint that has been formally brought by a government agency. The Securities and Exchange Commission, alleges and charges as follows:
The Securities and Exchange Commission announced it had halted an ongoing investment fraud targeting members of the Jewish community, primarily in the Los Angeles, CA region.
The SEC filed an emergency action in federal court against Motty Mizrahi and MBIG Company, his sole proprietorship, alleging that, since June 2012, they defrauded at least 15 advisory clients out of more than $3 million. According to the SEC's complaint, unsealed on March 29, 2019, Mizrahi falsely claimed that MBIG used sophisticated trading strategies to generate "guaranteed" returns of between 2-3% per month, the investments were risk-free, and clients would not lose their money and could withdraw their funds at any time. Unbeknownst to his clients, however, MBIG had no bank or brokerage account of its own - rather, clients unwittingly sent money to Mizrahi's personal bank account. Mizrahi used the money to fund his personal brokerage account, in which he engaged in high-risk options trading producing losses of more than $2.2 million, and to pay personal expenses. The SEC alleges that Mizrahi covered up his fraud by issuing MBIG's clients fabricated account statements, showing positive account balances and profits from trading. When clients demanded proof of MBIG's securities holdings, Mizrahi showed them brokerage statements reflecting a multi-million dollar balance for a fictitious MBIG brokerage account.
On March 27, 2019, the Honorable Judge Percy Anderson of the U.S. District Court for the Central District of California granted emergency relief, including a temporary restraining order against the defendants and an order freezing their assets.
In a parallel action, the United States Attorney's Office for the Central District of California announced on March 29, 2019 it filed wire fraud charges against Motty Mizrahi and another individual.
The SEC's complaint charges the defendants with violating the antifraud provisions of Section 10(b) of the Securities and Exchange Act of 1934 and Rule 10b-5 thereunder and Sections 206(1) and (2) of the Investment Advisors Act of 1940.
To access the full Securities and Exchange Commission press release, please visit: https://www.sec.gov/litigation/litreleases/2019/lr24435.htm
April 1, 2019 The following describes a Complaint that has been formally brought by a government agency. The Securities and Exchange Commission, alleges and charges as follows:
The Securities and Exchange Commission announced it had halted an ongoing investment fraud targeting members of the Jewish community, primarily in the Los Angeles, CA region.
The SEC filed an emergency action in federal court against Motty Mizrahi and MBIG Company, his sole proprietorship, alleging that, since June 2012, they defrauded at least 15 advisory clients out of more than $3 million. According to the SEC's complaint, unsealed on March 29, 2019, Mizrahi falsely claimed that MBIG used sophisticated trading strategies to generate "guaranteed" returns of between 2-3% per month, the investments were risk-free, and clients would not lose their money and could withdraw their funds at any time. Unbeknownst to his clients, however, MBIG had no bank or brokerage account of its own - rather, clients unwittingly sent money to Mizrahi's personal bank account. Mizrahi used the money to fund his personal brokerage account, in which he engaged in high-risk options trading producing losses of more than $2.2 million, and to pay personal expenses. The SEC alleges that Mizrahi covered up his fraud by issuing MBIG's clients fabricated account statements, showing positive account balances and profits from trading. When clients demanded proof of MBIG's securities holdings, Mizrahi showed them brokerage statements reflecting a multi-million dollar balance for a fictitious MBIG brokerage account.
On March 27, 2019, the Honorable Judge Percy Anderson of the U.S. District Court for the Central District of California granted emergency relief, including a temporary restraining order against the defendants and an order freezing their assets.
In a parallel action, the United States Attorney's Office for the Central District of California announced on March 29, 2019 it filed wire fraud charges against Motty Mizrahi and another individual.
The SEC's complaint charges the defendants with violating the antifraud provisions of Section 10(b) of the Securities and Exchange Act of 1934 and Rule 10b-5 thereunder and Sections 206(1) and (2) of the Investment Advisors Act of 1940.
To access the full Securities and Exchange Commission press release, please visit: https://www.sec.gov/litigation/litreleases/2019/lr24435.htm
Government Action:
The following describes a government action that has been resolved by either a settlement or a decision by a court or administrative agency. If the matter is being appealed, it will be noted below.
August 5, 2020 The following describes a Desist and Refrain Order that has been formally brought by a government agency. Manuel P. Alvarez and the Department of Business Oversight (Commissioner of Business Oversight), alleges and charges as follows:
At all relevant times herein, MBIG Corporation aka MBIG Company (MBIG) is, or was, a California corporation incorporated on or about February 2, 2005, with its principal place of business located at 17834 Burbank Boulevard, Suite 229, Encino, California 91316. MBIG claims it
is an advisory firm and money manager.
At all relevant times, Motty Mizrahi (Mizrahi) is, or was, a director, chief executive
officer, chief financial officer, secretary, and agent for process of service of MBIG. Mizrahi held himself out to potential investors as an investment adviser, money manager, licensed broker, and certified public accountant (CPA).
Beginning in or about June 2012, MBIG and Mizrahi offered and sold unqualified,
non-exempt securities in the form of investment contracts, comprising pooled investor money that
MBIG and Mizrahi represented would be used to trade in stocks and "fund insurance for investors all over the world." MBIG and Mizrahi offered and sold securities to investors in an affinity fraud targeting members of the Jewish Synagogue in the Los Angeles County.
MBIG and Mizrahi obtained investment money by soliciting friends and their family members and promising rates of return of "25% profit sharing per month" on their investments. MBIG and Mizrahi offered and sold securities to at least four California investors in excess of
$1,000,000.00.
Mizrahi and MBIG gave potential investors a "Prospectus" that described Mizrahi's profile and MBIG's purported investment methods and profitable track record. The Prospectus stated
that "(client) funds are actively managed by... Mizrahi who is the president of MBIG... He has over 20 years of experience investing in the stock and option market." The Prospectus also claimed that MBIG professionally manages and monitors funds and "has the ability to earn profits when stocks are going up or down through options." The Prospectus stated MBIG and Mizrahi "... use options strategies, including buying and selling of short call and short put spreads, and buying and selling LEAP options." MBIG and Mizrahi told investors MBIG and Mizrahi will "receive "25% of all profits generated" as compensation. Beginning in or about June 2012, MBIG and Mizrahi, for compensation, engaged in
business as investment advisers by advising investors as to the value of securities or as to the advisability of investing in, purchasing or selling securities. Mizrahi told investors that he is a broker and CPA with expert knowledge of the stock market. Mizrahi and MBIG told investors that their funds would be used in trading at E*TRADE and TD Ameritrade and would yield approximately 30-40% yearly returns.
MBIG and Mizrahi told investors to have full confidence that their investment "...is in
good hands" because they "use sophisticated options trading strategies to generate guaranteed returns on investment of between 2-3% per month." MBIG and Mizrahi assured investors that they will not lose their money; that their investment strategy is risk-free; that their funds are secure; that he maintains a large cash reserve of client funds so clients could withdraw their money at any time.
After investors invested in MBIG, Mizrahi sent investors periodic account statements purportedly showing the value of investors' stocks; the trades and profitability of the trades over time; and the net worth of their portfolios. However, these account statements were false.
At all relevant times, Mizrahi and MBIG did not have a valid investment adviser certificate issued by the Department of Business Oversight or the U.S. Securities and Exchange Commission. In connection with the offer and sale of securities, Mizrahi held himself out as an
investment adviser claiming he has over 20 years of experience investing in the stock and option
market.
In connection with the offer and sale of securities, Mizrahi and MBIG made, or caused
to be made, misrepresentations of material facts or omitted to state material facts necessary in order
to make the statements made, in the light of the circumstances under which they were made, not
misleading. These misrepresentations and omissions included, but are not limited to the following:
a) Mizrahi and MBIG represented or held themselves out to investors as licensed
or qualified investment advisers, licensed broker, and CPA.
b) MBIG and Mizrahi represented that MBIG had a brokerage account with E*TRADE and TD Ameritrade when in reality MBIG did not have such an account or any bank account of its own.
c) MBIG and Mizrahi "guaranteed returns" on investors' investment when in fact their trading produced persistent losses.
d) MBIG and Mizrahi represented that investors' funds were backed by cash reserves from which Clients could withdraw their funds at any time, when in reality investors could not withdraw their funds and their funds were not backed by cash reserves.
e) MBIG and Mizrahi represented to investors that their money would be used to trade in securities when in reality, Mizrahi used investor funds for his personal expenses.
f) MBIG and Mizrahi represented they were generating huge profits and thereafter distributed false accounts statements and/or reports showing positive account balances and monthly gains from MBIG's trading.
Based upon the foregoing, the California Commissioner of Business Oversight is of the
opinion that MBIG and Mizrahi engaged in the offer and sale of unqualified nonexempt securities in the form of investment contracts in MBIG. These securities have not been qualified under the California Corporate Securities Law of 1968, in violation of section 25110 of the Corporations Code.
Further, the Commissioner is of the opinion that Mizrahi and MBIG have conducted business as an investment adviser in this state without first applying for and securing from the commissioner a certificate, then in effect, authorizing them to do so, in violation of section 25230 of the CSL.
Finally, the Commissioner is of the opinion that the securities in the form of investment contracts in MBIG offered by MBIG and Mizrahi were offered and sold in this state by means of
written or oral communications, which included untrue statements of material fact or omitted to state material facts necessary in order to make the statements made, in the light of the circumstances under which they were made, not misleading, in violation of section 25401 of the CSL.
Pursuant to section 25532 of the California Corporate Securities Law of 1968, Motty Mizrahi
and MBIG Corporation aka MBIG Company are hereby ordered to:
a) Desist and refrain from the further offer or sale of securities in the State of California,
unless and until qualification has been made under the law or unless exempt.
b) Desist and refrain from acting as an investment adviser in the State of California
unless and until they have first applied for and secured from the Commissioner a certificate, then in effect, authorizing them to act as an investment adviser.
c) Desist and refrain from offering or selling or buying or offering to buy any security in
the State of California, including but not limited to, investment contracts, by means of any written or oral communication which includes an untrue statement of a material fact or omits to state a material fact necessary in order to make the statements made, in the light of the circumstances under which they were made, not misleading.
This Order is necessary, in the public interest, for the protection of investors and consistent
with the purposes, policies, and provisions of the Corporate Securities Law of 1968.
To access the full Department of Business Oversight press release, please visit: https://dbo.ca.gov/wp-content/uploads/sites/296/2020/08/D-R-MBIG-Corporation.pdf
August 5, 2020 The following describes a Desist and Refrain Order that has been formally brought by a government agency. Manuel P. Alvarez and the Department of Business Oversight (Commissioner of Business Oversight), alleges and charges as follows:
At all relevant times herein, MBIG Corporation aka MBIG Company (MBIG) is, or was, a California corporation incorporated on or about February 2, 2005, with its principal place of business located at 17834 Burbank Boulevard, Suite 229, Encino, California 91316. MBIG claims it
is an advisory firm and money manager.
At all relevant times, Motty Mizrahi (Mizrahi) is, or was, a director, chief executive
officer, chief financial officer, secretary, and agent for process of service of MBIG. Mizrahi held himself out to potential investors as an investment adviser, money manager, licensed broker, and certified public accountant (CPA).
Beginning in or about June 2012, MBIG and Mizrahi offered and sold unqualified,
non-exempt securities in the form of investment contracts, comprising pooled investor money that
MBIG and Mizrahi represented would be used to trade in stocks and "fund insurance for investors all over the world." MBIG and Mizrahi offered and sold securities to investors in an affinity fraud targeting members of the Jewish Synagogue in the Los Angeles County.
MBIG and Mizrahi obtained investment money by soliciting friends and their family members and promising rates of return of "25% profit sharing per month" on their investments. MBIG and Mizrahi offered and sold securities to at least four California investors in excess of
$1,000,000.00.
Mizrahi and MBIG gave potential investors a "Prospectus" that described Mizrahi's profile and MBIG's purported investment methods and profitable track record. The Prospectus stated
that "(client) funds are actively managed by... Mizrahi who is the president of MBIG... He has over 20 years of experience investing in the stock and option market." The Prospectus also claimed that MBIG professionally manages and monitors funds and "has the ability to earn profits when stocks are going up or down through options." The Prospectus stated MBIG and Mizrahi "... use options strategies, including buying and selling of short call and short put spreads, and buying and selling LEAP options." MBIG and Mizrahi told investors MBIG and Mizrahi will "receive "25% of all profits generated" as compensation. Beginning in or about June 2012, MBIG and Mizrahi, for compensation, engaged in
business as investment advisers by advising investors as to the value of securities or as to the advisability of investing in, purchasing or selling securities. Mizrahi told investors that he is a broker and CPA with expert knowledge of the stock market. Mizrahi and MBIG told investors that their funds would be used in trading at E*TRADE and TD Ameritrade and would yield approximately 30-40% yearly returns.
MBIG and Mizrahi told investors to have full confidence that their investment "...is in
good hands" because they "use sophisticated options trading strategies to generate guaranteed returns on investment of between 2-3% per month." MBIG and Mizrahi assured investors that they will not lose their money; that their investment strategy is risk-free; that their funds are secure; that he maintains a large cash reserve of client funds so clients could withdraw their money at any time.
After investors invested in MBIG, Mizrahi sent investors periodic account statements purportedly showing the value of investors' stocks; the trades and profitability of the trades over time; and the net worth of their portfolios. However, these account statements were false.
At all relevant times, Mizrahi and MBIG did not have a valid investment adviser certificate issued by the Department of Business Oversight or the U.S. Securities and Exchange Commission. In connection with the offer and sale of securities, Mizrahi held himself out as an
investment adviser claiming he has over 20 years of experience investing in the stock and option
market.
In connection with the offer and sale of securities, Mizrahi and MBIG made, or caused
to be made, misrepresentations of material facts or omitted to state material facts necessary in order
to make the statements made, in the light of the circumstances under which they were made, not
misleading. These misrepresentations and omissions included, but are not limited to the following:
a) Mizrahi and MBIG represented or held themselves out to investors as licensed
or qualified investment advisers, licensed broker, and CPA.
b) MBIG and Mizrahi represented that MBIG had a brokerage account with E*TRADE and TD Ameritrade when in reality MBIG did not have such an account or any bank account of its own.
c) MBIG and Mizrahi "guaranteed returns" on investors' investment when in fact their trading produced persistent losses.
d) MBIG and Mizrahi represented that investors' funds were backed by cash reserves from which Clients could withdraw their funds at any time, when in reality investors could not withdraw their funds and their funds were not backed by cash reserves.
e) MBIG and Mizrahi represented to investors that their money would be used to trade in securities when in reality, Mizrahi used investor funds for his personal expenses.
f) MBIG and Mizrahi represented they were generating huge profits and thereafter distributed false accounts statements and/or reports showing positive account balances and monthly gains from MBIG's trading.
Based upon the foregoing, the California Commissioner of Business Oversight is of the
opinion that MBIG and Mizrahi engaged in the offer and sale of unqualified nonexempt securities in the form of investment contracts in MBIG. These securities have not been qualified under the California Corporate Securities Law of 1968, in violation of section 25110 of the Corporations Code.
Further, the Commissioner is of the opinion that Mizrahi and MBIG have conducted business as an investment adviser in this state without first applying for and securing from the commissioner a certificate, then in effect, authorizing them to do so, in violation of section 25230 of the CSL.
Finally, the Commissioner is of the opinion that the securities in the form of investment contracts in MBIG offered by MBIG and Mizrahi were offered and sold in this state by means of
written or oral communications, which included untrue statements of material fact or omitted to state material facts necessary in order to make the statements made, in the light of the circumstances under which they were made, not misleading, in violation of section 25401 of the CSL.
Pursuant to section 25532 of the California Corporate Securities Law of 1968, Motty Mizrahi
and MBIG Corporation aka MBIG Company are hereby ordered to:
a) Desist and refrain from the further offer or sale of securities in the State of California,
unless and until qualification has been made under the law or unless exempt.
b) Desist and refrain from acting as an investment adviser in the State of California
unless and until they have first applied for and secured from the Commissioner a certificate, then in effect, authorizing them to act as an investment adviser.
c) Desist and refrain from offering or selling or buying or offering to buy any security in
the State of California, including but not limited to, investment contracts, by means of any written or oral communication which includes an untrue statement of a material fact or omits to state a material fact necessary in order to make the statements made, in the light of the circumstances under which they were made, not misleading.
This Order is necessary, in the public interest, for the protection of investors and consistent
with the purposes, policies, and provisions of the Corporate Securities Law of 1968.
To access the full Department of Business Oversight press release, please visit: https://dbo.ca.gov/wp-content/uploads/sites/296/2020/08/D-R-MBIG-Corporation.pdf
At-a-glance
Related Categories
Business Details
- Location of This Business
- 17834 Burbank Blvd Apt 229, Encino, CA 91316-1682
- BBB File Opened:
- 9/4/2020
- Contact Information
Principal
- Motty Mizrahi, CEO
Customer Complaints
0 Customer Complaints
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