Johanna Michely Garcia, the former CEO of MJ Capital Funding, LLC, has been sentenced to 20 years in prison for her role in a Ponzi scheme that defrauded investors of nearly $200 million. Garcia, aged 41 from Broward County, Florida, pleaded guilty on July 16 to conspiracy to commit mail and wire fraud.
Court documents reveal that Garcia led others, including Pavel Ramon Ruiz Hernandez, in the fraudulent investment scheme between October 2020 and August 2021. The scheme involved soliciting funds under the guise of providing merchant cash advances (MCAs) through MJ Capital Funding. Investors were misled into believing their money would fund MCAs and generate returns from profits made by the company. However, only a few loans were issued, and profits were insufficient to pay promised returns. Consequently, Garcia used new investor funds to pay existing investors while diverting millions for personal use. Investors lost approximately $90 million out of nearly $200 million raised.
After MJ Capital Funding was shut down by the FBI and SEC in late 2021, Garcia initiated another Ponzi scheme involving entities like New Beginning Global Funding LLC and Lion Heart Capital Group L.L.C., continuing operations even while in custody.
Ruiz Hernandez was charged in August 2022, pleaded guilty in April 2023, and received a sentence of over nine years in September 2023.
The case was announced by U.S. Attorney Markenzy Lapointe for the Southern District of Florida alongside Jeffrey B. Veltri from FBI Miami and Russell C. Weigel III from Florida's Office of Financial Regulation (OFR). The investigation involved contributions from FBI Miami and OFR with assistance from SEC’s Miami Regional Office.
Prosecution was handled by Assistant U.S. Attorney Roger Cruz with asset forfeiture managed by Assistant U.S. Attorney Marx Calderon.
Further details can be accessed on the District Court for the Southern District of Florida's website under case number 23-cr-20350.