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Buyers of RadioShack Accused of Running $112 Million Ponzi Scheme

3 weeks 4 days ago
An anonymous reader quotes a report from CBS News: A pair of e-commerce entrepreneurs who bought a number of well-known retail brands -- including RadioShack, Modell's Sporting Goods and Pier 1 Imports -- out of bankruptcy are accused of running a Ponzi scheme. The Securities and Exchange Commission on Monday accused Alex Mehr and Tai Lopez, founders of the Miami-based Retail Ecommerce Ventures (REV), of defrauding investors out of approximately $112 million. Through their holding company, Mehr and Lopez acquired distressed brick-and-mortar companies in order to turn them into successful, online-only brands. Dress Barn and Linens 'n Things were also among their acquisitions. [...] The SEC's suit alleges that between 2020 and 2022, Mehr and Lopez, "made material misrepresentations" to hundreds of investors about the bankrupt retailers they had acquired. For example, to entice individuals to invest in their acquisitions, they said their portfolio companies were "on fire" and that "cash flow is strong." They also told prospective backers that money raised for a company would only be invested in that specific firm. That proved not to be the case, according to the SEC's lawsuit, which was filed Monday in the U.S. District Court for the Southern District of Florida. "Contrary to these representations, while some of the REV Retailer Brands generated revenue, none generated any profits," the suit states. "Consequently, in order to pay interest, dividends and maturing note payments, Defendants resorted to using a combination of loans from outside lenders, merchant cash advances, money raised from new and existing investors, and transfers from other portfolio companies to cover obligations." The SEC alleges that at least $5.9 million of returns paid to investors were actually Ponzi-like payments funded by other investors, as opposed to companies' profits. Additionally, the federal regulatory agency claims that Mehr and Lopez allocated $16 million worth of investments for their own use, according to the filing.

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FCC Mistakenly Leaks Confidential iPhone 16e Schematics

3 weeks 4 days ago
The FCC mistakenly published a 163-page PDF containing detailed schematics for Apple's upcoming iPhone 16e, despite Apple explicitly requesting indefinite confidentiality to protect trade secrets. AppleInsider reports: A cover letter is also distributed alongside the schematics, addressed to the FCC and dated September 16, 2024. The letter from Apple is a request for the confidential treatment of documents that are filed with the FCC. [...] The letter from Apple requests a series of documents are withheld from public viewing "indefinitely." The justification is that they contain "confidential and proprietary trade secrets" that are not disclosed to the public post-release, due to giving competitors an "unfair advantage." The list of documents, Apple states, includes: Block Diagrams, Electrical Schematic Diagrams, Technical Descriptions, Product Specifications, Antenna Locations, Tune-Up Procedure, and Software Security Description. Other documents, such as external and internal photographs, shots of the test setup, and the user manual, are deemed to be less damaging and have "short-term confidentiality" requirements. In those cases, Apple asks for short-term confidentiality for 180 days after the equipment authorization is granted by the FCC.

Read more of this story at Slashdot.

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