JSG Capital Investments, a San Francisco hedge fund, has been accused of defrauding investors out of millions of dollars, with its CEO and a colleague having spent the money at strip clubs, casinos and sporting events. The U.S. Securities and Exchange Commission claims JSG Capital took close to $9.3 million in a ponzi scheme. The men reportedly sold fake pre-IPO shares of Uber, Airbnb and Alibaba, before transferring the money to their own personal accounts. Jason Gill, the CEO and founder, along with Javier Carlos Rios, allegedly defrauded 200 investors out of their money, taking new money and paying it to old investors. They used companies such as Airbnb, and Uber Technologies to entice investors, promising them that they would invest their money this way. Both men have been charged with conspiracy to commit wire fraud and wire fraud, according to the Department of Justice. Of the $9.3 million they are accused of raising, they are said to have stolen in excess of $5.5 million. Gill and Rios allegedly transferred less than 1% of investor funds to JSG Entity brokerage accounts and no pre-IPO company shares were ever purchased.
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