Fullerton insurance agent sentenced to five years for Ponzi scheme targeting Latino seniors
News: 2014 Press Release
LOS ANGELES, Calif. - Michael Zuno Zuniga, 43, of Fullerton, was sentenced to five years in Los Angeles County Jail and ordered to pay $1.2 million in restitution for his participation in a Ponzi scheme targeting LA area seniors.
Zuniga was arrested in June of 2012, after the Attorney General's office filed a criminal complaint alleging 57 felony counts against Zuniga. The complaint alleged that Michael Zuniga and his accomplices defrauded several senior citizens, many from the Latino community, of approximately$1.5 million in a highly organized and sophisticated Ponzi scheme.
"The fact that Zuniga used his position as a licensed agent to rip off vulnerable seniors is particularly insulting," said Insurance Commissioner Dave Jones. "Anyone who targets seniors with scams and rip offs deserves the maximum sentence allowed under the law. I am dedicated to finding and bringing to justice unscrupulous people like Zuniga who violate their fiduciary responsibility in the name of greed."
According to a joint California Department of Insurance and California Department of Justice investigation, as a licensed agent, Zuniga allegedly owned and conducted business as the Omega Investment Group (Omega), an unlicensed entity located in Downey, California. The investigation revealed a Ponzi scheme targeting Latinos through solicitation in their homes where Zuniga issued more than $1.3 million in fraudulent securities. The 57 count complaint included securities fraud, grand theft, elder abuse, burglary, and conspiracy. The joint investigation identified 18 victims throughout Los Angeles County.
Zuniga assisted many of his victims in refinancing their homes in order to invest in his scheme. He fraudulently represented that Omega was a profitable business that for three years bought and sold real estate that was in foreclosure. Omega claimed that these types of investments were so successful they guaranteed a 15 percent secured interest annually to those who invested.
The investigation revealed that Omega had not purchased or sold any property for three years prior to January 2007. A further review of Omega's bank records revealed that it was never a profitable business and did not secure investments with property or any other assets as promised. In actuality, Omega's owners diverted $663,000, from the $1.5 million collected to purchase real estate for an undisclosed entity known as Homes Brought Current, and then used the fraudulently diverted funds for personal benefit. Additionally, in true Ponzi fashion, payments Omega made to newer investors were from prior investor funds, rather than business profit.
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Media Notes:This case was investigated by CDI's Los Angeles Investigation Division and DOJ's Attorney General's Office, Special Crimes Unit. The case prosecution handled by the California Attorney General's Office.
- Booking Photo Available
- Press release from June 8, 2012
- License details for M. Zuniga
- Enforcement action against M. Zuniga
Led by Insurance Commissioner Ricardo Lara, the California Department of Insurance is the consumer protection agency for the nation's largest insurance marketplace and safeguards all of the state’s consumers by fairly regulating the insurance industry. Under the Commissioner’s direction, the Department uses its authority to protect Californians from insurance rates that are excessive, inadequate, or unfairly discriminatory, oversee insurer solvency to pay claims, set standards for agents and broker licensing, perform market conduct reviews of insurance companies, resolve consumer complaints, and investigate and prosecute insurance fraud. Consumers are urged to call 1-800-927-4357 with any questions or contact us at www.insurance.ca.gov via webform or online chat. Non-media inquiries should be directed to the Consumer Hotline at 800-927-4357. Teletypewriter (TTY), please dial 800-482-4833.
