Defendant Charged In Over $50 Million Ponzi Scheme And Related Investment Fraud

United States Attorney for the Southern District of New York, Jay Clayton, and Assistant Director in Charge of the New York Field Office of the Federal Bureau of Investigation (“FBI”), Christopher G. Raia, announced the unsealing of an Indictment charging PAUL REGAN with conspiracy, securities fraud, and wire fraud.  The charges in the Indictment arise from a scheme to defraud retail investors in projects called Next Level Holdings (“Next Level”) and Yield Wealth Ltd. (“Yield”) by misrepresenting how those companies would use investors’ money and the protections investors would have against losses.  REGAN’s fraudulent scheme tricked over 300 people to invest more than $60 million in the Next Level and Yield investment products.  When the fraud was eventually exposed, REGAN’s investors were left with over $50 million in losses.  REGAN was arrested in the Southern District of Florida on September 4, 2025, and ordered detained following his removal from the Republic of Colombia.  The case has been assigned to U.S. District Judge Valerie E. Caproni.

“As alleged, Paul Regan promised high returns but, in reality, he simply used money from new investors to pay off old investors, keeping the fraud going until pointed questions were asked,” said U.S. Attorney Jay Clayton.  “There is no place in our markets for scammers, particularly those who prey on Main Street investors.  The women and men of the Southern District are committed to putting these scammers out of business permanently.”

“Paul Regan allegedly defrauded over 300 investors of more than $60 million through false promises of protected investments and guaranteed returns while using these deposits to quietly repay other entities,” said FBI Assistant Director in Charge Christopher G. Raia.  “This alleged scheme was shrouded in deceit to entice hundreds of clients before ultimately betraying their confidence and their savings.  The FBI will continue to investigate all widespread schemes exploiting the wallets of victims, regardless of where the defendant may be located.”

According to the allegations in the Indictment unsealed on September 4, 2025, in Manhattan federal court:[1]

From at least 2022 through December 2024, REGAN and a team of salesmen and associates defrauded hundreds of retail investors by offering investment products through two entities, Next Level and Yield, based on false and misleading statements.  REGAN and his co-conspirators misrepresented how Next Level and Yield would use investors’ money and what protections investors would have against losses.  These misrepresentations fraudulently induced over 300 people to invest more than $60 million in the Next Level and Yield investment products.  When REGAN’s fraud was eventually exposed, REGAN closed Next Level and Yield, leaving investors with over $50 million in losses.

Next Level Notes

REGAN advertised himself as the Chief Executive Officer of Next Level and claimed that Next Level was in the business of providing capital and operational support to mining operations in Colombia.  In exchange for this support, Next Level supposedly received precious metals at discounted prices, which Next Level sold at a profit.

In at least in or about mid-2022, REGAN and others began using Next Level to sell what REGAN called “Next Level Holdings Principal & Interest Protected Guaranteed Note[s]” (the “Next Level Notes”).  REGAN sold Next Level Notes himself and recruited independent salespeople to sell Next Level Notes using information and sales techniques that REGAN and others working at Next Level provided.

According to marketing materials that REGAN circulated to investors and salespeople, investors who purchased Next Level Notes were guaranteed to receive double-digit returns, with no risk of loss, through Next Level’s precious-metals business.  For example: Next Level’s marketing materials represented that investors who made a minimum investment of $50,000 could purchase a Next Level Note with a term of three, five, seven, or 10 years.  Each Note came with a contractually guaranteed double-digit annual yield—typically between 12% and 15% depending on the duration of the Note; Next Level’s marketing materials represented that each Next Level Note came with a “noncancelable indemnity or surety bond backed by an insurance company that guarantee[d] that principal and interest will be paid in compliance with the contractual agreement or promissory note.”  This meant that holders of Next Level Notes “[could not] lose their principal investment and also serve[d] as a guarantee that [investors] will receive the interest offered in our enhanced annuity note offering in full.”

The Next Level marketing materials that REGAN circulated also made representations about how Next Level would use investor funds and how it planned to protect investors from losses.  With respect to returns, the marketing materials represented that Next Level had a successful track record in “gold and precious metals trade finance operations,” and that Next Level would use investor funds to finance mining operations and generate returns from selling precious metals.  As for protections, the marketing materials represented that Next Level would obtain for investors “full insurance protections” from a handful of companies, including a Colombian entity (“Company-1”) and an American reinsurance company (“Company-2”).  The marketing materials said that this insurance was designed to offer noteholders “ultimate safety and peace of mind for your retirement portfolio in these very uncertain times.”

Next Level issued each investor who purchased a Next Level Note a “Fully Insured Secured Promissory Note,” which set forth the terms of the investment (including the principal amount and interest rate) and included an “Unconditional Loan Guarantee,” representing that Next Level would provide the investor “with a noncancelable surety bond, or other like insurance policy or product to serve as an unconditional guarantee for the Holder that he shall receive payment of both principal and interest on this note.”

Consistent with that representation about insurance, Next Level also sent investors two insurance-related documents: the first was a document titled a “Surety Bond Contract,” purportedly from Company-1, which guaranteed that Company-1 would pay the noteholder the full amount of principal and interest Next Level owed under the note, in the event Next Level did not pay.  The second was a document titled a “Reinsurance Cover Note,” purportedly from Company-2, which guaranteed that Company-2 would also insure the noteholder up to the full amount of principal and interest payments required under the terms of the note.

Between 2022 and late 2024, Next Level sold approximately 300 Next Level Notes to investors, including to at least one investor located in the Southern District of New York.  In total, the investors in Next Level Notes sent more than $45 million to business entities under the control of REGAN.

Yield Term Deposits

In or about early 2024, REGAN and others launched a new business venture called Yield, which REGAN advertised as an alternative to traditional banks that could offer investors higher returns on their savings and greater protections.

In or about March 2024, REGAN began using Yield to sell what he called “Mega High Yield Term Deposit[s]” and “Super High Yield Term Deposit[s]” (collectively, the “Yield Term Deposits”).  As with Next Level Notes, REGAN sold Yield Term Deposits himself and recruited independent salespeople to sell Yield Term Deposits using information and sales techniques that REGAN and others working at Yield provided.

Much like with Next Level Notes, REGAN circulated marketing materials to investors and salespeople, claiming that investors in Yield Term Deposits were guaranteed to make significant returns with no risk. For example: yield marketing materials described Yield as “revolutionizing the banking industry with Enhanced Term Deposits, offering yields up to 10.5% APY and security through insurance coverage up to $10 million.”  The materials went on to explain that investors could invest in Yield Term Deposits, with terms of between five and 10 years.  Investors would receive guaranteed interest payments each year, with rates ranging up to 10.5% per year, depending on the term of the deposit and other payment options the investor selected.  The marketing materials represented that interest payments and investors’ principal would be fully insured, stating that “[y]our APY is 100% guaranteed and insured” and that Yield Term Deposits “offer[] additional insurance on deposits up to $10 million, ensuring unparalleled security for your savings”; similarly, Yield’s website advertised Yield as a new, digital bank that gave investors access to better interest rates and protections than traditional financial institutions.  The website allowed investors to calculate returns they would receive from different Yield Term Deposits and touted that Yield Term Deposits were backed by insurers who “provid[e] our depositors the ultimate in insurance protection for both . . . principal and interest”; Yield’s website claimed that Yield would generate returns for investors through a “diverse portfolio that spans multiple industries, including the lucrative sectors of mining and rare minerals.”  REGAN separately represented to investors and people selling Yield Term Deposits that Yield would also use investor funds to make investments in plans related to the Affordable Care Act.

Yield sent investors who purchased Yield Term Deposits a “Subscription Agreement” and a “Limited Partnership Agreement,” through which the investors purchased units in either the Mega High-Yield Term Deposit LP or the Super High-Yield Term Deposit LP.  The agreements represented, among other things, that investors would receive “an annual percentage yield of no less than” between 5.5% and 8.5%, depending on the type of investment.

Over the course of 2024, Yield sold approximately 85 Yield Term Deposits, totaling more than $15 million deposited by investors.

The Defendant Defrauded Investors

The promises that REGAN and others made to investors about how Next Level and Yield would use their money and protect their investments were materially false and misleading.

When REGAN promoted Next Level Notes and Yield Term Deposits, a core component of that pitch was that Next Level and Yield would use investors’ money to generate significant returns, including through precious-metals operations and investments related to the Affordable Care Act.  Those claims were false and misleading.  In reality, REGAN and his co-conspirators ran Next Level and Yield like a Ponzi scheme, using money obtained from earlier investors to pay later investors and to pay commissions to salespeople.  Meanwhile, Next Level and Yield made no meaningful investments in either precious-metals operations or investments related to the Affordable Care Act.  Instead, REGAN and his co-conspirators misappropriated investor money, which included using investor funds for personal payments and sending large sums of money to entities that did not generate returns for Next Level or Yield, let alone investors.

Another important representation that REGAN made when marketing Next Level Notes and Yield Term Deposits was that investors would have insurance to guarantee promised interest payments and prevent them from losing their investments.  Those representations were also false and misleading.

Next Level did not obtain insurance for the vast majority of noteholders and did not maintain insurance for any of them.  Specifically, between in or about 2022 up to and including late 2023, Next Level obtained authentic surety bonds from Company-1 and reinsurance from Company-2 for approximately 70 Next Level Notes, with a total investment value of approximately $7.75 million.  Next Level then stopped paying to maintain that coverage and did not purchase any surety bonds or reinsurance for the more than 200 Next Level Notes it issued over the course of 2024.  Instead, Next Level sent the investors who purchased those notes forged surety bonds and forged reinsurance paperwork.  REGAN and his co-conspirators also furthered this fraudulent scheme by sending investors and salespeople forged letters that appeared to come from a senior executive at Company-1 and represented that Company-1 would insure more than $100 million of Next Level Notes.  Similarly, notwithstanding the representations that Yield Term Deposits had insurance to guarantee interest payments and protect up to $10 million of principal, Yield did not purchase or maintain insurance for Yield Term Deposits.

Investors Suffered Significant Losses

On or about August 30, 2024, a news outlet published an article about Yield and REGAN expressing skepticism about Yield.  REGAN responded to the article by holding a videoconference with salespeople, in which REGAN claimed that the article was false and misleading and urged salespeople to continue selling Yield Term Deposits.

In or about November 2024, Next Level and Yield closed, leaving investors with over $50 million in losses.

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REGAN, 48, of New York, New York, is charged with one count of conspiring to commit securities fraud and wire fraud, which carries a maximum sentence of five years in prison; one count of securities fraud, which carries a maximum sentence of 20 years in prison; one count of wire fraud, which also carries a maximum sentence of 20 years in prison; and one count of aggravated identity theft, which carries a mandatory term of two years in prison.

Mr. Clayton also thanked the U.S. Securities and Exchange Commission, which has filed a civil enforcement action, the Justice Department’s Office of International Affairs, the Criminal Division’s Narcotic and Dangerous Drug Section’s Office of Judicial Attaché in Bogotá, Colombia and the authorities of the Republic of Colombia for their assistance.

This case is being handled by the Office’s Securities and Commodities Fraud Task Force.  Assistant U.S. Attorneys Thomas S. Burnett and Maggie Lynaugh are in charge of the prosecution. 

The charges contained in the Indictment are merely accusations, and the defendant is presumed innocent unless and until proven guilty.