Laguna Niguel Man Gets Prison Time For $63M Ponzi Scheme

LAGUNA NIGUEL, CA — The founder and chief executive of a private equity fund was sentenced Thursday to 33 months in federal prison for ripping off hundreds of investors of about $63 million in a Ponzi scheme.

Marco Giovanni Santarelli, 57, of Laguna Niguel, pleaded guilty Oct. 20 of last year to a count of wire fraud.

Santarelli, the founder of Norada Capital Management, recruited investors nationally from June 2020 through June of 2024 to put their money in unsecured promissory notes ranging from $25,000 to $500,000 that promised high- yield monthly interest rates of about 12% to 15% over three to seven years, prosecutors said.

Santarelli's attorney, Robert Bernhoft, told U.S. District Judge Fred W. Slaughter that his client had a successful career in real estate in the 1990s. He "made a lot of contacts" in the real estate industry and planned to "leverage" that experience with Norada, Bernhoft said.

But it all went awry when the defendant's investments in e-commerce, real estate, Broadway shows and cryptocurrency, failed, prosecutors said.

It was then that "He started lying to himself and others," his attorney said.

Bernhoft pointed to multiple letters from family and friends written on his behalf for the sentencing. He noted that his client has "always lived simply," driving the same car for the last 10 years and living in the same house for the last 20 years.

Unlike most Ponzi schemers, Santarelli did not spend lavishly on himself, but recruited new investors to try to keep the business going, Bernhoft argued.

The defendant's main character flaw was being too trusting of his financial partners, Bernhoft argued.

An emotional Santarelli, who choked up reading a statement to Slaughter, said when he started his company, "I wanted to help people, but in the end I hurt people."

He kept recruiting investors when he realized his company was failing because he was "hoping to outrun those failures," he said.

"I didn't want to admit I failed. I was wrong," Santarelli said.

He felt remorse for his victims, he said.

"They trusted my judgment," he said. "They trusted me to tell the truth. They trusted me with their hard-earned money. To all those people, I've spent a lot of time thinking about the harm I caused ... I wish I could undo it and make everyone whole... I regret what I did and I will carry that shame for the rest of my life... I am so deeply sorry for what I've done."

Probation officials recommended a 51-month prison term. Bernhoft requested 27 months.

Assistant U.S. Attorney Jennifer Waier told Slaughter that prosecutors recommended 33 months based on the defendant's cooperation with authorities, but could not support any more reductions in the punishment.

Waier said it was "compelling and helpful the defendant took responsibility for his actions."

But, she added, "He was caught committing fraud for four years with 400 victims," stealing $63 million.

"That is a lot of money," she said. "And how did the defendant take $63 million? Because he promised he would take care of them and reinvest their funds. He promised them he would keep it safe and they relied on these promises."

The victims "lost more than just money," she said. "They've lost trust. They've lost the ability to feel safe."

Some victims won't be able to "send their kids to college or go on a vacation or live the lives they planned," she said.

Waier argued, "This fraud is different. When the company was going belly up, the defendant doubled down."

Santarelli doctored documents to keep up the facade of a successful investment firm, she said.

Jamie Brasseal told Slaughter he lost $200,000 in the scheme.

"Most of that money was from my retirement savings," Brasseal said.

The healthcare tech salesman has had to go back to work and his wife has taken on a second job to try to recover, he said.

When Brasseal said he tried to find out what happened to his investment, Santarelli said he could do nothing about it and "continued trying to convince me to invest" in another project.

"I've lost sleep. I've struggled with anxiety," Brasseal said. "I wake up every morning wondering how could this happen."

Brasseal said he curates a social media group of victims and that "some are facing greater hardships than mine."

To Santarelli, Brasseal said, "You didn't take our money. You took away a retirement I spent a lifetime to earn."

Slaughter ordered Santarelli to pay $63,165,357.94 in restitution. The government has so far recovered $5.5 million of that.

The defendant's attorney said his client has also given up two condos in Dubai and a home in Orlando (Florida) that the government is working to secure and sell for restitution.

Bernhoft asked Slaughter to let the defendant report to prison Jan. 2 so he could spend the holidays with his family, but that irked Slaughter.

"You can have an early holiday season," Slaughter said. "The holiday is in the heart."

Santarelli was ordered to surrender to authorities by Dec. 4.