The U.S. Securities and Exchange Commission alleges that a firm which scooped up struggling retail names like RadioShack and Pier 1 Imports—touting lofty e-commerce ambitions and outsized investor returns—was in fact running a Ponzi-style scheme.
Amid the pandemic’s surge in retail bankruptcies, Retail Ecommerce Ventures snapped up a string of iconic brands at bargain prices, betting on their comeback as online-first businesses. The company’s portfolio now spans Dress Barn, Modell’s Sporting Goods and Stein Mart.
In a lawsuit filed Monday in federal court in the Southern District of Florida, regulators allege that REV touted its portfolio as “on fire” in slick promotional videos to lure investors.
According to the SEC, not a single venture ever turned a profit, yet co-founders Taino Lopez and Alexander Mehr, along with chief operating officer Maya Burkenroad, kept investors in the dark. The agency says the firm plugged financial gaps with outside loans, cash advances, and money from both new and existing investors.
The SEC alleges the company raised $112 million from hundreds of investors through fraudulent offerings, with roughly $5.9 million of those payouts amounting to Ponzi-style returns.
Lopez and Mehr—whom the SEC accuses of siphoning about $16.1 million for personal use—did not immediately respond to requests for comment.
The SEC noted that while the firm touted Burkenroad—Lopez’s cousin—as a veteran with over a decade of experience running multimillion-dollar companies, her background actually included stints as a substitute preschool teacher and radio station promoter. Burkenroad did not immediately respond to a request for comment.
The SEC is seeking civil penalties, restitution of ill-gotten gains, and a court order permanently barring the defendants from serving as officers or directors of any company.
