Omar Dario Chavez, also known as Omar Aiden Chavez, of Southern California, told prospective clients that he was averaging monthly returns of 10 to 20 percent from his own securities trading. He told them that if they entrusted him with their money he would guarantee its return, backed by $1 million to $2 million of his own personal assets. According to the SEC he did not have those assets. Between October 2022 and March 2025, Chavez obtained more than $940,000 from at least 16 clients, several of them elderly, on the strength of those representations. He then sent them monthly statements reporting profits. The SEC alleges the profits were fabricated and that his actual trading lost hundreds of thousands of dollars over the same period. On September 3, 2026, the Commission filed fraud charges against him in the Central District of California.
The SEC’s complaint charges Chavez with violating Section 10(b) of the Exchange Act and Rule 10b-5, Section 17(a) of the Securities Act, and Sections 206(1) and 206(2) of the Investment Advisers Act, and seeks permanent injunctive relief, disgorgement with prejudgment interest, and a civil penalty. This case is not settled. The Commission also states that it appreciates the assistance of the U.S. Attorney’s Office for the Central District of California and the Federal Bureau of Investigation, an acknowledgment that ordinarily indicates a parallel criminal investigation.
A Guarantee Backed by Assets That Were Not There
The personal guarantee is the element that distinguishes this case from ordinary trading losses. Telling a client that a trading strategy returns 10 to 20 percent a month is a claim about performance, and performance claims can be checked against statements, at least in principle. Telling a client that their principal is personally guaranteed against one to two million dollars of your own assets is a claim about your balance sheet, and it converts what the client understands to be a speculative arrangement into something closer to a secured deposit. According to the SEC, Chavez did not hold assets anywhere near that figure. The guarantee that made the risk acceptable did not exist.
A monthly return of 10 to 20 percent is also, on its own, an implausible claim. Sustained over a year it would compound into a multiple of the original capital, a record that would make the trader one of the most successful in the world. The complaint alleges the reality ran in the opposite direction, with Chavez losing hundreds of thousands of dollars in the market during the same period he was reporting steady double-digit monthly gains on paper.
The Statements Were Not Just Cover, They Were the Sales Tool
The fabricated monthly statements served two purposes. They concealed the losses, which is the obvious function. But according to the complaint they also induced existing clients to entrust him with additional money. A client who receives a statement showing consistent gains does not merely fail to withdraw. Many will add to a position that appears to be working, and some will recommend it to others. In that way the false statement is not a defensive measure taken after a loss, it is the instrument that generates the next deposit.
Some of that new client money, according to the SEC, went to pay earlier clients. That is the marker regulators use to separate a struggling trading business from a fraud, because a trader having a bad year still pays redemptions out of remaining capital, whereas paying one client with another client’s fresh deposit means the underlying returns do not exist. The complaint further alleges that Chavez diverted client funds directly to his own expenses, including his rent and credit card bills.
Several of the Clients Were Elderly
The SEC specifically notes that several of the 16 victims were elderly. That detail affects the practical harm rather than the legal analysis. An investor in their thirties who loses their savings has decades of earning years to rebuild. A retired investor who hands over money on a personal guarantee, receives statements showing it growing for two and a half years, and then learns the account was never what the statements said, generally does not. Sixteen clients and $940,000 makes this a small case by the standards of SEC enforcement, and it drew no press coverage beyond the initial filing. The size of a fraud and its effect on the people inside it are different measurements.
Conclusion
Omar Chavez told at least 16 people, several of them elderly, that he was making 10 to 20 percent a month trading securities and that he would personally guarantee their principal against a million or two of his own assets. He did not have the assets. He was not making the returns. For roughly two and a half years he sent them monthly statements showing profits that the SEC says he invented, used the confidence those statements created to collect more money, paid some clients with other clients’ deposits, and spent some of it on his rent and credit cards. He is charged under the antifraud provisions of three federal securities statutes. He has not settled, and the FBI and the U.S. Attorney assisted the investigation.
