Charlotte man ran $7 million Ponzi scheme that funded ‘lavish lifestyle’, SEC alleges

A Charlotte businessman has been charged with operating a $7 million Ponzi scheme and defrauding dozens of local investors to fund his “lavish lifestyle,” the Securities and Exchange Commission said in new court documents.

Wynn Charlebois, a “self-proclaimed business consultant,” defrauded at least 75 investors out of millions of dollars through his company, WC Private LLC, and “multiple bogus investment opportunities,” the agency said in a news release Friday.

The SEC filed an emergency action in U.S. District Court for the Western District of N.C. on Thursday seeking injunctions to stop Securities Act violations, among other requests.

“This is a serious litigation matter that I look forward to resolving,” Charlebois told The Charlotte Observer via text message Friday. “Until then, no parties will be served well by discussing it at this time.”

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Money from the alleged scheme went to a range of Charlebois’ personal expenses, the SEC said in its court filing, from covering university tuition for one of his kids to limo service bills and a stay at the Ritz Carlton in the mountain village of Beaver Creek, Colorado, during a family vacation.

How the alleged scheme worked

In court filing, the SEC alleged that Charlebois used his social capital in Charlotte and network of former co-workers from an investment bank he worked at decades ago to solicit investors.

Charlebois offered investors an opportunity to share in the profits earned through participation in fictitious options contracts, the SEC said in its news release.

He told potential investors that he was a highly successful investor who had previously served as a consultant for private companies, court documents allege.

The SEC documents say Charlebois told investors he had received stock options from those firms to purchase shares in those companies, and could do so at a price that would result in an immediate gain for investors.

But those companies had never issued the stock options to Charlebois, the SEC told the court, and the purchase agreements were fabricated.

“The funds Charlebois received from investors were not invested as he said they would be, and he had no income stream from anything other than the money he received from new investors, loans from personal friends, and merchant cash advance loans,” the SEC lawyers said.

Paying for personal expenses

SEC lawyers allege that Charlebois used investor funds to pay other investors as well as family debts and personal expenses like mortgage payments, vacations and private schooling for his children.

Those expenses included nearly $11,000 in airfare fees in 2021, the SEC said in court documents, and a January 2021 family trip to Colorado. That’s where Charlebois spent over $3,400 in four days “at places such as the Ritz Carlton Bachelor Gulch, and various restaurants and ski locales in the surrounding Beaver Creek and Vail area,” the SEC said.

Two months later, in March 2021, the Charlebois family spent a week vacationing in Boca Grande, Florida, where they spent $8,792 “despite a negative balance in Charlebois’ personal joint checking account during the trip,” the SEC said in its court filing.

When investors raised questions, the SEC alleged, Charlebois engaged in “lulling activity” like saying he was working on other time-sensitive business projects or that the transfer of the funds was delayed.

Charlebois also “provided fabricated documents to (investors) to induce them to invest money with him and the entities he controlled,” the SEC claimed in court documents.

From Feb. 5, 2019, through April 30, 2022, at least $7.1 million of investor funds flowed into Charlebois’ accounts, of which at least $4.4 million was paid to investors, the complaint said.

The SEC is seeking an injunction that would permanently prevent Charlebois and his LLC from issuing, purchasing, offering or selling any security, except purchasing or selling securities for his own personal accounts.

The SEC also asked the court to mandate that Charlebois pay civil penalties, as well as freeze assets and force him to give up “ill-gotten gains,” the SEC said in its news release.

The investigation of the case is ongoing, the SEC said.