Key Takeaways
- • Marco Giovanni Santarelli, 57, founder and former CEO of Norada Capital Management in Laguna Niguel, California, was sentenced on Thursday, October 15, to nearly three years (33 months) in federal prison after pleading guilty to wire fraud.
- • Santarelli was ordered to pay more than $63 million in restitution to investors, per the U.S. Department of Justice.
- • Prosecutors alleged the firm ran a Ponzi scheme from June 2020 to June 2024, drawing more than 400 investors through unsecured, high-yield promissory notes promising monthly returns of 12% to 17%.
- • Interest payments were funded with other investors' money, while the firm's investments in e-commerce, real estate, Broadway shows and cryptocurrency reportedly were not profitable.
Summary
A former California private equity executive was sentenced in federal court on Thursday, October 15, to nearly three years in prison for running a Ponzi scheme that defrauded hundreds of clients of more than $63 million, according to the U.S. Department of Justice and the East Bay Times. Marco Giovanni Santarelli, 57, of Laguna Niguel, founded and served as CEO of Norada Capital Management. He pleaded guilty in October 2025 to one count of wire fraud and was also ordered to pay more than $63 million in restitution.
Santarelli promoted himself as a "wealth creator" and marketed the firm through podcasts, websites and webinars. Norada said it offered unsecured, high-yield promissory notes backed by investments in Broadway musicals, real estate and cryptocurrency. Prosecutors said that between June 2020 and June 2024, clients invested between $25,000 and $500,000 in the notes, with promised monthly interest payments of 12% to 17% over three to seven years. The pitches, delivered in part through webinars, presented the investments as predictable, "passive" returns suitable for retirement funds.
According to prosecutors, the firm did not pay the promised returns. Instead, it invested in risky assets that were not profitable and generated little return, and it paid existing investors' interest with money from new investors. The scheme drained the savings of more than 400 investors.
The case underscores the risks of unsecured private promissory notes marketed as fixed-income alternatives, particularly when offered to retail investors with retirement savings. Federal prosecutors have framed the outcome as a conviction for a classic Ponzi structure rather than a legitimate private equity strategy.
Santarelli promoted himself as a "wealth creator" and marketed the firm through podcasts, websites and webinars. Norada said it offered unsecured, high-yield promissory notes backed by investments in Broadway musicals, real estate and cryptocurrency. Prosecutors said that between June 2020 and June 2024, clients invested between $25,000 and $500,000 in the notes, with promised monthly interest payments of 12% to 17% over three to seven years. The pitches, delivered in part through webinars, presented the investments as predictable, "passive" returns suitable for retirement funds.
According to prosecutors, the firm did not pay the promised returns. Instead, it invested in risky assets that were not profitable and generated little return, and it paid existing investors' interest with money from new investors. The scheme drained the savings of more than 400 investors.
The case underscores the risks of unsecured private promissory notes marketed as fixed-income alternatives, particularly when offered to retail investors with retirement savings. Federal prosecutors have framed the outcome as a conviction for a classic Ponzi structure rather than a legitimate private equity strategy.
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