Litigation Releases (Yossi Engel)

U.S. SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 26052 / July 19, 2024

Securities and Exchange Commission v. Yossi Engel, No. 2:23-cv-00213-PA (C.D. Ca. Jan. 12, 2023)

SEC Obtains Final Judgment Against a Los Angeles Individual for Perpetrating a $47 Million Affinity Fraud Targeting Members of the Orthodox Jewish Community

On July 15, 2024, the Securities and Exchange Commission obtained a final judgment against Yossi Engel, whom the SEC charged for perpetrating a $47 million affinity fraud from December 2018 to January 2020, targeting at least 29 members of the Orthodox Jewish community.

The complaint alleged that Engel, through his company, iWitness Tech, LLC, initially induced members of the Orthodox community to invest by falsely telling them that he would use their funds to purchase and install security camera equipment. In the second iteration of his scheme, Engel allegedly promised to use investor funds to purchase a property in Israel that he would then develop and sell. The complaint alleges both claims were false and that rather than use investor money to purchase cameras or develop property, Engel misappropriated the funds by spending investor money for his personal benefit and making Ponzi-like payments to earlier investors in an attempt to keep the scheme going.

Engel consented to a final judgment permanently enjoining him from violating 17(a) of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder. Engel was ordered to pay disgorgement in the amount of $5,099,826.00, representing his net profits gained from the conduct alleged in the Complaint, together with prejudgment interest in the amount of $381,731.80. However, the disgorgement figure was deemed satisfied by the restitution order entered in the parallel criminal action United States v. Yossi Engel, Crim. No. CR 23-00213 MEMF (C.D. Cal.), requiring Engel to pay $11,758,030.58.

The SEC's litigation was led by Daniel Blau and supervised by Douglas M. Miller of the Los Angeles Regional Office. The SEC's investigation was conducted by Tamar Braz and Dora Zaldivar and supervised by Marc Blau. The SEC acknowledges the assistance of the Israel Securities Authority.