SEC Charges Former Trucking Execs Over $112 Million Ponzi Scheme (2024)

Two executives at Florida-based, now-defunct trucking and logistics firm Royal Bengal Logistics Inc. have been charged in participating in a Ponzi scheme that fraudulently raised roughly $112 million from 1,500 investors.

The Securities and Exchange Commission (SEC) charged Broward County, Florida residents Ricardi Celicourt and Brisly Guillaume with violations of the securities registration and broker-dealer registration provisions.

From approximately April 2021 until June 2023, the defendants sold investments to public investors despite never being registered as brokers or dealers with the SEC, or being associated with a registered broker-dealer.

Celicourt and Guillaume served as then-vice president and director of BRL’s business development and investor relations department during the period.

Prior court documents also state that the two executives received approximately $1.3 million in transaction-based bonuses for their roles in the alleged Ponzi scheme.

The $1.3 million, according to the 12-page SEC complaint filed July 18, were bonuses tied to their sales. Celicourt was compensated $517,000 in bonuses, while Guillaume received $787,000.

Royal Bengal Logistics was formed in June 2018 and began raising funds from investors in August 2019 purportedly to increase the size of its fleet of trucks and grow its operations. But like the securities sold by Celicourt and Guillaume, RBL’s investment offerings have never been registered with the SEC.

The defendants solicited investors through promotional videos, including videos which were publicly available on YouTube and RBL’s website, in-person investor presentations, investor conferences and word-of-mouth, the complaint said.

Prior to investing in one of Royal Bengal’s investment programs, investors typically met with a member of the company’s business development and investor relations department, including with the defendants.

Department members routinely spoke with investors about the logistics company’s investment programs and provided them offering materials and a brochure, entitled the “RBL Investor Plan,” which described each of four investment programs along with their requirements.

Those investment programs promised guaranteed returns ranging from 12.5 percent to as high as 325 percent depending on the program.

Through the four programs, RBL raised at least $109 million of the total $112 million raised from investors.

Investors were given the opportunity to buy into a short-term investment program, which sought a minimum of $25,000; a long-term owner financing program, requiring a payout of at least $60,000; and a trailer sponsorship program that required a minimum investment of $50,000. For the third program, investors were told the funds would be used to build trailers in India for shipment to the U.S.

The fourth investment opportunity, an equipment management program, required a minimum investment of $55,000 that would be used to purchase and operate a truck.

A majority of the investors were from South Florida’s Haitian-American community, which the SEC said were specifically targeted by the scheme. The plot also included residents from at least 17 other states, Washington, D.C., Haiti, Canada and India.

The SEC’s complaint seeks permanent injunctions, civil money penalties, and disgorgement of ill-gotten gains with prejudgment interest against both defendants.

This is the second enforcement action relating to Royal Bengal. In June 2023, the SEC filed an emergency action against the trucking and logistics provider and its then-president, Sanjay Singh, and obtained, among other relief, emergency orders freezing Royal Bengal’s and Singh’s assets and appointing a receiver over Royal Bengal.

Singh was arrested on criminal charges of conspiracy to commit wire fraud, several counts of wire fraud and engaging in transactions in unlawful proceeds. His trial is scheduled to begin in September.

Between August 2019 and June 2023, Royal Bengal Logistics lost more than $18 million, the initial SEC complaint said. The company needed roughly $70 million from new investors to pay promised returns to existing investors, the complaint states.

As of February 2023, Royal Bengal’s bank accounts had dwindled to about $2.1 million, leaving the company unable to pay interest and principal owed to hundreds of investors, the complaint states.

The complaint against Royal Bengal and Singh also accused the former president of misappropriating at least $14 million in investor funds to himself and others, who did not provide any legitimate services for those investor funds. The defendants diverted more than $19 million to two broker accounts controlled by Singh, who engaged in “highly speculative equities trading on margin” and ultimately lost $1 million.

Royal Bengal Logistics’ common carrier authority was granted in August 2018 before its authority was involuntarily revoked after the SEC shut down the company with a restraining order in August 2023, after asset freeze took place.

Prior to its closure, the company had 91 drivers and 166 power units, according to its latest filings with the Federal Motor Carrier Safety Administration (FMCSA).