Gautam Arora, 38, of Tustin, California, was arrested on 11 felony counts of securities violations and money laundering after a California Department of Insurance investigation reportedly found he allegedly defrauded four victims out of $100,000 to secure investments that did not exist.

Arora worked as a licensed insurance agent between 2018 and 2019 and recruited individuals to work for him in a multi-level marketing agency. He reportedly obtained victims’ private financial information through an alleged “financial review,” then solicited victims to invest in his fictitious investments.

Arora deposited victim funds into his personal account and used the investment funds he received for personal expenses, casino trips, and to return prior investor funds, according to the CDI. His broker-dealer license was terminated by Financial Industry Regulatory Authority on Dec. 18, 2019.

Arora reportedly made numerous material misrepresentations of fact regarding the investments and failed to make clients aware of his poor financial status, which included: overdrawn bank accounts, over $68,000 in credit card debt, and filed civil suits and orders to pay unpaid debts. Victims were led to believe that their investments were legitimate.

Prior to the charges, Arora entered into a settlement agreement with the department to pay $57,000 in restitution to victims of his alleged fictitious investments. However, CDI reported that Arora failed to pay any portion of the restitution, which resulted in suspension of Arora’s insurance licenses and licensing rights. Last month Arora was ordered to reimburse the department $81,000 for investigative costs. The department also imposed an insurance industry ban against Arora.

Arora was arrested by the Tustin Police Department and booked into the Orange County Jail. Bail was set at $100,500. The case is being prosecuted by the Orange County District Attorney’s Office.

Topics
California
Agencies

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