SEC accuses REV founders of $112 million Ponzi scheme tied to RadioShack, Pier 1 Imports

The U.S. Securities and Exchange Commission filed a civil complaint in the Southern District of Florida accusing Alex Mehr and Tai Lopez, founders of the Miami-based Retail Ecommerce Ventures (REV), of operating a $112 million Ponzi-like scheme tied to the revival of bankrupt retailers including RadioShack, Pier 1 Imports, and Modell’s Sporting Goods, as well as Dress Barn and Stein Mart. The complaint portrays a pattern of misrepresentation aimed at attracting investment to funds that were purportedly earmarked for the specificREV Retailer Brands. The action marks a rare federal enforcement step against a prominent investment-backed approach to reviving brick-and-mortar brands amid a wave of store closures in prior years. The Post’s coverage of the case notes the allegations align with earlier reporting on REV’s strategy, but the SEC’s filing provides new, court-filed detail on the scheme.

According to the SEC, Mehr and Lopez made material misrepresentations to hundreds of investors about the performance of the REV Retailer Brands between 2020 and 2022, insisting the companies were thriving and that funds raised would be used solely for the respective brand subsidiaries. In reality, the agency alleges, while some REV Retailer Brands generated revenue, none produced profits. The complaint further contends that at least $5.9 million in purported investor returns were funded by new investor money rather than from the operating companies themselves, a hallmark of Ponzi-like payments. The SEC also accuses the pair of diverting about $16.1 million for personal use.

To sustain payments to backers, prosecutors say the defendants relied on a mix of external loans, merchant cash advances, and transfers from other portfolio companies, in addition to money raised from new and existing investors. These funding channels, the SEC alleges, were used to cover interest, dividends and the maturation of notes, rather than to support legitimate business cash flows. The court filing describes a structure designed to preserve the illusion of ongoing profitability and investor returns while actual profits remained elusive.

REV’s acquisitions began in 2020, including the purchase of RadioShack three years after its bankruptcy filing. The firm then acquired Modell’s Sporting Goods and Pier 1 Imports in 2020, among other bankrupt brands, with the objective of rebranding them as online-only retailers in a bid to capture e-commerce growth. The portfolio also encompassed Dress Barn and Stein Mart, according to the SEC complaint. Mehr, described in court records as Iranian-born and a former risk and safety manager who worked on NASA space exploration missions, partnered with Lopez, a social media influencer known for authoring the self-help program “67 Steps,” in pursuing these purchases.

The SEC’s complaint does not allege any criminal conduct, but it seeks relief typical of civil enforcement actions, including penalties and injunctions to halt further alleged misconduct. Neither Mehr nor Lopez immediately responded to requests for comment, and it was not clear whether they have retained counsel or will contest the allegations. The defendants have previously spoken publicly about REV’s mission to revive legacy brands, though their specific comments on the SEC’s filing were not available at the time of this report.

The case underscores ongoing scrutiny of investment strategies that aim to revive failing retailers by consolidating and rebranding them under online-focused models. It also highlights the risks involved for investors in funds that promise rapid returns tied to the performance of legacy brands, especially when those brands operate under restructuring or liquidation conditions. In the broader market, the RETAIL sector has experienced ongoing volatility as consumer behavior shifts toward e-commerce, making the SEC’s filing a notable development for investors and market observers alike.

The SEC’s complaint, filed in federal court in Florida, seeks civil penalties and injunctions against Mehr and Lopez, with the agency arguing that the investment scheme harmed hundreds of investors who were led to believe their money would fuel specific brand operations. The case remains ongoing as authorities continue to pursue remedy and recoveries for investors. No timetable has been provided for further court proceedings, and additional filings will outline the specific relief the SEC seeks and the defenses the defendants may raise.