SEC v. Ashraf Mufareh and ONPASSIVE LLC

Ashraf Mufareh and OnPassive LLC allegedly orchestrated a fraudulent and unregistered offering of securities in a business that appears to be structured as a pyramid scheme and making misrepresentations about the feasibility and likely profitability of the business. According to the SEC, between 2018 and 2023, the defendants fraudulently raised more than $108 million from more than 800,000 investors across the globe by falsely claiming to be developing a suite of online computer applications that used artificial intelligence. According to the complaint, the defendants sold investors positions in a multi-level marketing arrangement and promised passive income from subscription fees paid by later investors for those computer applications. As of June 2023, defendant OnPassive LLC allegedly had not yet launched any product for a fee and had not made a single commission payment to any investor.

Summary generated from official Securities and Exchange Commission press release