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Press Release

Multiple Federal Fraud Charges Filed Against San Francisco Father And Son

For Immediate Release
U.S. Attorney's Office, Northern District of California

SAN FRANCISCO - Santos Rene Soto and Santos Moises Soto III appeared in federal court today to face a federal indictment charging them with conspiracy, wire fraud, bank fraud, and false statements in a loan application, announced U.S. Attorney Stephanie M. Hinds and FBI San Francisco Special Agent in Charge Robert K. Tripp.

Santos Rene Soto (Santos), 59, and Santos Moises Soto III, also known as Saints Soto (Saints), 39, both of San Francisco, are described in the indictment as a father and son who engaged in multiple frauds. The first charged fraud involves Golden Spear LLC, an artificial intelligence (AI) technology company purportedly based in San Francisco and Barcelona, Spain. Saints was the CEO, and Santos acted as a board member. According to the indictment, GoldenSpear offered clothing retailers an “A.I. Fashion Assistant” that used “visual and textual algorithms” to help retailers identify specific fashion brands and clothing that their customers might want to purchase. The indictment describes that from 2017 to March 2020 Saints raised investment funds by representing to potential investors that GoldenSpear had entered into contracts with, or discussed investments or acquisitions by, numerous established business entities. These representations were false, according to the indictment. GoldenSpear allegedly raised more than $12 million in investment funds. 

The indictment further describes that following the onset of the Covid-19 pandemic in early 2020, Saints and Santos began raising investment funds for a new subsidiary of GoldenSpear named “AI Health.” Saints and Santos informed potential investors that AI Health created a wearable device that, using AI, detected the COVID-19 virus in its wearer. Saints and Santos allegedly made numerous representations, including that the devices were being worn in a Los Angeles high school by students and staff, that AI Health was conducting a large study using data from a Los Angeles-based children’s hospital, and that a prominent accounting firm valued AI Health at more than $100 million. The indictment charges that these representations were false. AI Health, according to the indictment, raised more than $2.5 million from investors.

The indictment lastly alleges that Saints and Santos defrauded the Paycheck Protection Program (PPP), a federal government pandemic relief program. The PPP is administered by the U.S. Small Business Administration as part of the Coronavirus Aid, Relief, and Economic Security (CARES) Act. CARES is a federal law enacted in March 2020 to provide billions of dollars in emergency financial assistance to millions of Americans suffering from the economic effects of the COVID-19 pandemic. The PPP provided forgivable loans to small businesses for job retention and limited other business expenses. The indictment describes that on April 2, 2020, GoldenSpear submitted a PPP application in which Saints and Santos represented that GoldenSpear had 33 employees located in the United States, a monthly payroll of $267,899, and a monthly office rental expense of approximately $18,000. Instead, the indictment alleges, GoldenSpear averaged seven to eight U.S.-based employees and had an average monthly payroll of $67,000 or less. Additionally, the indictment alleges that the address listed on the PPP application for the commercial lease was in fact Santos’s residential address. A PPP loan in an amount of $669,700 was approved and issued based on the misrepresentations of Santos and Saints, the indictment charges. 

Santos and Saints made their initial appearance in federal court today before United States Magistrate Judge Thomas S. Hixson. Their next scheduled appearance is scheduled before the same judge on October 12 at 10:30 a.m.

Santos and Saints are charged with one count of conspiracy in violation of 18 U.S.C. § 371, which carries a maximum sentence of five years in federal prison. Saints and Santos are also charged with one count of conspiracy to commit wire fraud in violation of 18 USC §§ 1343 and 1349, which carries a maximum 20 year sentence. Saints is also charged with two counts and Santos is charged with one count of wire fraud, and each count carries a maximum sentence of 20 years. Santos and Saints also face one count of bank fraud in violation of 18 U.S.C. § 1344 and one count of making false statements on a loan application in violation of 18 U.S.C. § 1014, each of which carries a maximum sentence of 30 years. The court may also order additional fines, restitution, and forfeiture on each count. However, any sentence following conviction would be imposed by the court only after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.

The charges in the indictment are merely allegations and the defendants are presumed innocent unless proven guilty in a court of law.

The case is being prosecuted by the Corporate and Securities Fraud Section of the U.S. Attorney’s Office for the Northern District of California. Ross Weingarten and Alethea Sargent are the Assistant U.S. Attorneys who are prosecuting the case, with the assistance of Margoth Turcios. The prosecution is the result of an investigation by the FBI.

Updated October 4, 2022