The U.S. Securities and Exchange Commission has filed a lawsuit against entrepreneurs Tai Lopez and Alex Mehr, alleging that the pair orchestrated a $112 million Ponzi-like scheme through their company, Retail Ecommerce Ventures (REV).

Retail Brands at the Center

Lopez and Mehr promoted a high-profile strategy of acquiring distressed retail names — including RadioShack, Pier 1 Imports, Modell’s Sporting Goods, Dress Barn, and Linens ’n Things — with promises to transform them into profitable online businesses. Regulators now say those promises were built on false claims.

The SEC’s Allegations

The SEC’s complaint states that Lopez and Mehr misled investors by claiming the acquired companies were “on fire” with strong cash flows. In reality, according to the agency, none of the brands turned a profit.

Instead, the defendants allegedly used loans, cash advances, and new investor funds to pay interest and dividends — a pattern the SEC says matches the classic markers of a Ponzi scheme. The filing also alleges that more than $16 million was diverted for personal use.

Key Figures Named

Alongside Lopez and Mehr, the SEC named Maya Burkenroad, REV’s Chief Operating Officer and Lopez’s cousin, as having aided the misconduct. The complaint accuses the company of misrepresenting her professional background to investors.

A Stunning Fall

The charges mark a dramatic turn for Lopez, who became famous for his viral “Here in My Garage” video urging followers to “read a book a day.” Once a symbol of entrepreneurial hustle, Lopez now faces accusations of deceiving investors in some of America’s most recognizable retail brands.

What Comes Next

The SEC is seeking disgorgement of investor funds, civil penalties, and officer-director bans for Lopez, Mehr, and Burkenroad. The lawsuit was filed in the U.S. District Court for the Southern District of Florida. Neither Lopez nor Mehr has commented publicly on the allegations as of publication.