SEC Charges Bay Area Real Estate Lender's Executives in $80 Million Ponzi-Like Scheme

The Securities and Exchange Commission has charged two former executives of a Marin County real estate lender with running a Ponzi-like scheme that took in more than $80 million from roughly 190 investors, many of them retired seniors, before collapsing last fall when the firm could no longer meet withdrawal requests. The agency's announcement, filed Tuesday, names Mark D. Hanf, the former chief executive of Pacific Private Money Group LLC, and Hoai-Nam Chu Phan, known as Nam Phan, the former chief operating officer of one of the company's fund subsidiaries.

According to the complaint filed in federal court in the Northern District of California, Hanf and Phan told investors between December 2021 and November 2025 that their money would fund short-term real estate loans carrying guaranteed preferred or fixed returns. Instead, the SEC alleges, the two funds paid earlier investors with money raised from new ones, a structure that could not be sustained once redemption requests outpaced incoming capital. The complaint alleges Hanf personally misappropriated more than $7 million of investor funds. Across both funds, roughly $121 million in investments remained outstanding when the scheme unraveled, and the SEC says an accounting completed in February found less than $17 million in assets left to satisfy those claims.

"This alleged scheme began to unravel in the fall of 2025 as numerous investors demanded to withdraw their money and the defendants did not have sufficient funds to satisfy those requests," Jason Lee, associate director of the SEC's San Francisco Regional Office, said in the agency's announcement. The SEC's Division of Enforcement charged Hanf with violating antifraud provisions of both the Securities Act and the Securities Exchange Act, while Phan faces related but narrower charges reflecting his role as a subsidiary officer rather than the parent company's chief executive. Both men agreed to permanent injunctions against future securities-law violations without admitting or denying the SEC's allegations; a judge will determine disgorgement, interest and civil penalties at a later date.

The case also has a criminal track. Securities.io reported that the U.S. Attorney's Office for the Northern District of California announced parallel criminal charges against both men the same day the SEC's civil case was unsealed. The Mercury News reported that Hanf, 66, of Tiburon, and Phan appeared in federal court and entered not-guilty pleas to the criminal charges, which mirror the fraud allegations in the SEC's complaint.

Pacific Private Money Group, based in Novato, marketed itself for years to Bay Area investors, including retirees, as a stable alternative to stock-market volatility, offering fixed-income-style returns backed by real estate collateral. The firm has since ceased operating the funds at the center of the case. The SEC's filing does not name a receiver or specify a recovery process for investors, though the sizable gap between the roughly $121 million owed and the less than $17 million in identified assets suggests many will recoup only a fraction of what they put in. The parallel criminal proceeding, which carries the possibility of prison time in addition to the financial penalties sought by the SEC, is expected to move on a separate schedule from the civil case as both work through the Northern District of California's court system.