Tr?id=566623520170033&ev=PageView&noscript=1

SEC Charges Two South Florida Men for Defrauding Venezuelan-American Investors in $5 Million Scheme

Posted on October 2nd, 2024 at 4:30 PM
SEC Charges Two South Florida Men for Defrauding Venezuelan-American Investors in $5 Million Scheme

From the desk of Jim Eccleston at Eccleston Law

The Securities and Exchange Commission (SEC) has filed a complaint against two South Florida men, Francisco Javier Malave Hernandez and Ricardo Javier Guerra Farias, for orchestrating a multi-million dollar investment fraud that targeted members of the Venezuelan-American community. As reported by AdvisorHub, the duo operated through a fake financial advisory firm, Toller Stern Financial Services, raising nearly $5 million by selling fraudulent promissory notes.

The SEC’s complaint highlights this case as an example of affinity fraud, where perpetrators exploit trust within a community- here, based on shared ethnic identity. The SEC alleges that Malave and Guerra falsely promised investors that their funds would be invested in legitimate ventures, including equities, cryptocurrencies, real estate, and foreign exchange markets using an automated trading platform. However, no trading profits materialized.

Instead, Malave and Guerra misappropriated investor funds, using the capital for Ponzi-like payments to other investors and diverting significant sums for personal use—$558,900 by Malave and $109,500 by Guerra. They misled investors about the financial condition of Toller Stern and commingled funds between Toller Stern and a related entity, Toller Asset.

The scheme collapsed in early 2022 when the firm ceased making interest payments to investors. Without admitting or denying the SEC's allegations, Malave, Guerra, and Toller Stern consented to a settlement. The SEC is seeking $3.25 million in restitution and penalties.

Eccleston Law LLC represents investors and financial advisors nationwide  in securities, employment, transition, regulatory, and disciplinary matters.

Tags: eccleston, eccleston law, sec

Return to Archive

TESTIMONIALS

Previous
Next
Quotes Bigger

I want to thank you for your excellent professional representation. It was greatly appreciated.

Michael M.

LATEST NEWS AND ARTICLES

1778171646 Law
May 7, 2026
FINRA Bars Former Raymond James Broker for Refusing Testimony in Unauthorized Trading Probe

A former registered representative with Raymond James has been barred from the securities industry after refusing to cooperate with a Financial Industry Regulatory Authority (FINRA) investigation into alleged unauthorized trading activity.

1778084309 Law
May 6, 2026
FINRA Outlines Key Rulemaking Priorities and Recent Developments in Quarterly Agenda

The Financial Industry Regulatory Authority (FINRA) recently released its Quarterly Regulatory Policy Agenda, offering a detailed view of its rulemaking priorities, pending proposals, and recently approved regulatory changes.

1778000603 Law
May 5, 2026
Commonwealth Financial Network Resolves SEC Conflict of Interest Case

Commonwealth Financial Network has agreed to pay $5 million to resolve a long-standing conflict of interest case brought by the Securities and Exchange Commission, according to reporting by ThinkAdvisor.