SEC v. Matthew M. Motil; North Shore Equity Sales, LLC, d/b/a The Marie Paul Company; North Shore Equity Management, LLC; and Amy Doubrava Motil, No. 1:23-cv-01853, Northern District of Ohio (Oct. 4, 2023) — Complaint

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UNITED STATES DISTRICT COURT 
NORTHERN DISTRICT OF OHIO 
EASTERN DIVISION 
                                        
    ) 
SECURITIES AND EXCHANGE COMMISSION,  ) 
         ) 
                               Plaintiff,         ) CASE NO.  23-CV-1853               
v.         ) 
         ) 
MATTHEW M. MOTIL                                                       ) 
NORTH SHORE EQUITY SALES, LLC, d/b/a      ) JURY DEMANDED  
THE MARIE PAUL COMPANY;    )  
NORTH SHORE EQUITY MANAGEMENT, LLC;        ) 
         ) 
                                Defendants,    ) 
    )    
AMY DOUBRAVA MOTIL,    ) 
     ) 
 Relief Defendant.    ) 
                                                       ) 
 
COMPLAINT 
   
Plaintiff, the Securities and Exchange Commission (“SEC”), alleges as follows:  
SUMMARY 
1. For  almost  four  years,  Matthew  M.  Motil  (“Motil”)  devised  and  carried  out  an 
offering  fraud  and  Ponzi  scheme  that  defrauded  investors  of  millions  of  dollars. He  promised 
investors short-term, low-risk, and high-return promissory notes supposedly fully collateralized by 
first mortgages on residential real estate located throughout Ohio. Motil falsely told investors that 
he  would  use  their  investments  to  renovate  the  properties  and  pay  them  back  with  profits  from 
reselling  the  properties,  refinancing  them,  or  renting  them.  Nearly  everything  about  his scheme 
was  a  lie.  Many  of  the  promissory  notes  he  offered and  sold  to  investors  were  not  “fully  
collateralized  by  first  mortgages”  because  Motil  purposely  issued  multiple  promissory  notes  
“secured” by the same property to numerous investors.  
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2. In  one  instance,  Motil  obtained  over  $1.3  million  from  at  least  twenty  separate 
investors, issuing at least twenty notes “secured” by one single-family home that was purchased 
for $47,000 and never valued at more than $130,000. Despite promising many investors that he 
would record their mortgages, Motil failed to do so. Ultimately, Motil used investor funds to (1) 
make over $3.7 million in Ponzi payments; (2) spend over $1.6 million on personal expenses; (3) 
divert over $900,000 of investors’ money to other businesses unrelated to real estate, and (4) route 
hundreds  of  thousands  more  to  his  wife,  Amy  Doubrava  Motil  (“Amy  Motil”  or  “Relief  
Defendant”). Motil intentionally or recklessly failed to disclose any of this to his investors. 
3. From as early as October 2017 through May 2021 (the “Relevant Period”), Motil, 
operating through North Shore Equity Sales, LLC d/b/  a The Marie Paul Company (“NS Sales”), 
North Shore Equity Management, LLC (“NS Management”) and a variety of other LLCs that he 
created,  raised  over  $11  million  from  more  than  60  investors  located  across  the  United  States.  
Motil  persuaded  individuals,  including  a  cancer  researcher  and  an  active-duty  U.S.  Air  Force  
Lieutenant Colonel, to invest their retirement funds and life savings with him by advertising his 
own financial acumen and track record of success.  
4. After Motil’s Ponzi scheme collapsed, he filed for personal bankruptcy in March 
2022, seeking  to  discharge  the  millions  of  dollars  he  personally  owed  to  the  investors  he  had  
victimized. In his bankruptcy petition, Motil failed to divulge that his debts were from his Ponzi 
scheme.  Instead,  Motil  identified  the  victimized  investors  as  his  “creditors,”  claiming that his 
personal  debts  arose  from  “guarantees  of  debts  of  [Motil]  LLCs.”  However,  in  response  to  the  
Amended Complaint filed by the U.S. Trustee in its adversarial proceeding, Motil contended that 
the victim-creditors of his Ponzi scheme are creditors of corporations and LLCs that Motil owned.  
5. Motil actively participated in his bankruptcy case but has ignored numerous SEC 
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administrative subpoenas for testimony and documents served upon him personally.  
6. As  a  result  of  the  conduct  described  in  this  Complaint,  the  Defendants  violated  
Sections  5(a)  and (c)  and  17(a)  of  the  Securities  Act  of  1933  (“Securities  Act”),  [15  U.S.C.  §§ 
77e(a), (c), and 77q(a)]; and Section 10(b) and Rule 10b-5 of the Securities Exchange Act of 1934 
(“Exchange Act”), [15 U.S.C. § 78j(b) and 17 C.F.R. §240.10b-5]. Unless restrained and enjoined, 
they are reasonably likely to continue to violate the federal securities laws. 
7. The Commission seeks a judgment from the Court: (i) permanently enjoining the 
Defendants  from  violating  the  applicable  provisions  and  rules  of  the  federal  securities  laws  as 
alleged and asserted below; and from participating directly or indirectly in the issuance, purchase, 
offer or sale of any security (provided that such order would not prevent Defendants from buying 
and  selling  securities  listed  on  a  national  securities  exchange  for  their  respective  personal  
accounts);  (ii) barring  Motil  from  becoming  an  officer  or  director  of  a  public  company;  (iii)  
directing  the  Defendants  to  disgorge  all  net profits  they  received  as  a  result  of  the  acts  and/or  
courses of conduct complained of, with prejudgment interest; (iv) directing the Defendants to pay 
civil money penalties; (v) creating a Fair Fund pursuant to Section 308(a) of the Sarbanes-Oxley 
Act;   (vi)  ordering  Relief  Defendant  to  disgorge  any  ill-gotten  gains  plus  prejudgment  interest  
thereon; and  (vii)  granting  such  other  and  further  relief  as  this  Court  may  determine  to  be  just,  
equitable, and necessary. 
JURISDICTION AND VENUE 
8. The  SEC  brings  this  action  pursuant  to  Section  20(b)  of  the  Securities  Act  [15  
U.S.C.  §77t(b)],  and  Sections  21(d)  and  21(e)  of  the  Exchange  Act  [15  U.S.C.  §§78u(d)  and  
78u(e)]. In connection with the conduct described herein, Defendants directly or indirectly made 
use  of  the  means  or  instrumentality  of  interstate  commerce,  or  of  the  mails,  in  connection  with  
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their actions as alleged in this Complaint. T hroughout the Relevant Period, Defendants solicited 
and received funds from investors throughout the United States by interstate wire transfers, and 
Motil communicated with and solicited out of state investors via his website, various social media 
accounts, and/or by telephone and e-mail.  
9. Venue is proper in this Court pursuant to Section 27 of the Exchange Act [15 U.S.C. 
§  78aa].  Motil  and  Amy  Motil  reside  and  can  be  found  in  this  District,  and  certain  of  the  acts, 
practices  and  courses  of  business  constituting  the  violations  alleged  herein  occurred  within  this  
District. Specifically, many of the residential real estate properties involved in Motil’s fraud are 
located within this District.  
DEFENDANTS  
10. Motil, age 42, is a resident of North Olmsted, Ohio, and is the owner and principal 
of NS Sales and NS Management and each related party described below. Motil is an Ohio-licensed 
Professional Engineer, a  nd a self-described entrepreneur and real estate expert. Motil holds a Ph.D. 
and an MBA, and has claimed to have a J.D. majoring in Intellectual Property, earned in one year 
from  the  University  of  Akron School  of  Law. Motil  created  and  controlled  numerous  bank  
accounts  at  JPMorgan  Chase  Bank  NA  in  the  names  of  NS  Sales,  NS  Management,  the  related  
parties (and others) that he used to facilitate the fraudulent scheme described herein (each a “Chase 
Account”  and  collectively  the  “Chase  Accounts”).  On  March  7,  2022,  Motil  filed  a  voluntary  
petition under Chapter 7 of the Bankruptcy Code for personal bankruptcy in the Bankruptcy Court 
for the Northern District of Ohio.  
11. NS Sales is  an Ohio LLC created and controlled by Motil with its principal place 
of business in Ohio. NS Sales also used a number of registered trade names including “The Marie 
Paul Company.” NS Sales held properties and issued promissory notes to investors that contained 
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materially false and misleading statements and/or omissions. Motil instructed investors to deposit 
their money into a Chase Account in the name of NS Sales. Motil used the funds in the NS Sales 
Chase Account for personal expenditures, as well as to make payments due to previous investors 
(“Ponzi Payments”) and to businesses unrelated to real estate. NS Sales is not registered with the 
Commission in any capacity. 
12. NS Management is an Ohio LLC created and controlled by Motil with its principal 
place of business in Ohio. Like NS Sales, NS Management held properties and issued promissory 
notes  to  investors  that  contained  materially  false  and  misleading  statements  and/or  omissions. 
Motil also requested that some investors transfer their money to a Chase Account in the name of 
NS  Management.  Motil  used  the  funds  in  the  NS  Management  Chase  Account  for  personal  
expenditures, as  well  as  to  make  Ponzi  Payments and  payments  to businesses unrelated  to  real 
estate. Motil also transferred investor funds from the Chase Account in the name of NS Sales to 
the Chase Account in the name of NS Management, where it was used to make Ponzi Payments, 
to pay personal expenses and make payments to businesses unrelated to real estate.  
RELIEF DEFENDANT 
13. Amy Motil, age 35, is married to Motil and resides in North Olmsted, Ohio. Certain 
banking records list Amy Motil as “COO”   and 50% owner of NS Sales, and as a “Member”   of NS 
Management. Amy Motil received at least $400,000 of investor money.  
RELATED PARTIES 
14. BUYCLE112, LLC; BUYCLE114, LLC; BUYCLE158, LLC;  BUYCLE175, LLC; 
BUYCLE176, LLC; INVCLE150, LLC; NS Equity Cleveland, LLC; NSEM Mansfield 1, LLC; 
and NSEM Mansfield 2, LLC (each a “Motil LLC” and together “the Motil LLCs”) are all Ohio 
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LLCs that were created and controlled by Motil. The Motil LLCs held real estate and/or issued 
promissory notes that contained materially false and misleading statements and/or omissions.  
FACTS 
I. Motil’s Solicitation Efforts 
15. During  the  Relevant  Period,  Motil  described himself as  a  self-made  real  estate  
entrepreneur who  helped  “hundreds  of  investors  throughout  the  world  to  create  massive  wealth  
through real estate.” He advertised himself using his website at http://www.drmattmotil.com (the 
“Motil Website”) and numerous social media accounts (including accounts at Facebook, LinkedIn 
and Biggerpockets.com) and podcasts. 
16. The   Motil   Website   told   prospective investors   that   Motil had   “investment 
opportunities ranging from $10,000 to $10 million,” and invited those who visited the website to 
“Be  a  Real  Estate  Investing  Badass!”  and  to  “fire  [their]   boss,  quit  [their]   9  to  5,  and  build  a  
business/lifestyle [they]   love earning a passive income from real estate investments.” The Motil 
Website  and  Motil’s  social  media  accounts  offered links  to  podcasts on  Apple  and  YouTube  
entitled “The Cash Flow King, The Realest Real Estate Podcast,” hosted by “Doctor Motil.”  
17. A former employee of Motil testified under oath that they believed that the podcast 
was  part  of  a  broader media  presentation  to  convince  people  to  invest  with  Motil  and  his  
companies. Motil released approximately 147 episodes of the podcast. 
18. In  one  podcast dated November  8,  2019  titled  “Funding  Back  Private  Money,” 
Motil talked at length about the “huge level of responsibility”   that comes with accepting real estate 
investments from individuals. He said:  
When  someone  has  worked  at  a  job  or  a  business  .  .  . there’s  a  
significant  level  of  effort  that  has  gone  into  the  creation  of  that  
capital. And so when [people] are willing to take that [money] and 
hand it to you in good faith, [there’s an obligation] that you’re going 
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to turn it around and give them a nice return on their money. They 
have  put  a  lot  of  faith  in  you. And  you  have  a  significant  level  of  
responsibility  to  make  sure  that,  not only  are  you  doing  what  you  
said  you  were  going  to  do,  but  you  give  them  the  return  that  you  
promised. . . . [w]e don’t do unsecured notes so . . . we’re doing a 
promissory note and a mortgage, one investor-one deal and so 
you’re first lien position on the property, just like a bank. 
 
(emphasis added). When Motil made this statement, which he knew or recklessly failed to know 
was false, he had already defrauded numerous investors; after making this statement, he continued 
to defraud investors for well over a year.  
19. Through the Motil Website and certain social media accounts he controlled, Motil 
invited visitors to submit their e-mail address to receive copies of his newsletter and to schedule a 
call to speak with him directly. Once investors signed up for the newsletter or scheduled a phone 
call,  Motil  typically  solicited  them  directly  by  e-mail with  “private  lending  opportunities”   that 
briefly described, in bullet-point format, several promissory notes.  
20. The  descriptions  included:  (i)  their  principal  amounts;  the  applicable  annual  
percentage rate (“APR”) (usually 8%-15%); (ii) the term (usually 6-18 months); and sometimes 
(iii)  a  brief  description  of  the  residential  property  that  would  collateralize  the  promissory  note  
(such  as  the  number  of  bedrooms  and  baths  and  a  property  valuation estimate).   Motil does  not  
appear to have attempted to screen accredited investors. 
21. In his conversations with investors, Motil often told them, among other things, that 
he bought houses, renovated them, and either sold them at a profit or refinanced them and rented 
them. He often emphasized that investors would play an entirely passive role and they would not 
need  to  participate  in  the  renovation,  rental  or  refinancing  of  the  property. Motil  told  multiple  
investors that they essentially would be “acting as a bank” because their funds would be secured 
by a first position mortgage lien on the property and they would receive interest payments and, at 
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the end of the term, their principal. Motil knew or recklessly failed to know that this was false. 
Motil also told investors on numerous occasions (sometimes in writing and sometimes orally) that 
after he received their investment he would record the mortgage with the county clerk, knowing 
or recklessly failing to know that this was false.  
II. The Investments Offered By Motil 
22. After  an  investor  selected  a  particular  investment  from among Motil’s list  of  
“private lending opportunities,” Motil created and issued a promissory note corresponding to the 
investor’s choice (the “Notes”). The Notes set forth, among other things, the APR, the repayment 
schedule, the address of the property that would purportedly collateralize the Note, and the name 
of  the  entity (usually a  Motil  LLC,  but  sometimes  NS  Sales  or  NS  Management)  that  Motil 
identified as the borrower. Motil signed the Notes on behalf of the borrower. 
23. Motil also  sent investors a  document  he  created  titled  “Mortgage.”  The mostly-
boilerplate  language  in  the  Mortgages generally  contained  covenants  prohibiting Motil from 
creating or accruing any debt, lien or charge that would have priority over the Note received by 
the investor. The covenants in the Mortgages underscored what Motil told many investors orally: 
their investments were collateralized by first position mortgages on residential properties. 
24.  In addition to the Notes and Mortgages, Motil also sent payment instructions for 
investors to fund their Note. Motil typically instructed investors to send their money to a Chase 
Account. Motil specifically told numerous investors that after he received their money he would 
record  the  mortgage  and  they  would  receive  a  signed  copy  of  the  recorded  mortgage  mailed  
directly from the appropriate county clerk.  
25. Motil often told investors that the county clerks were backlogged and that it took 
several  weeks  or  months  to  send  their  recorded  mortgages.  But Motil was  just  buying  time.  He 
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knew that county clerks could not possibly mail a copy of the recorded mortgages  because, among 
other things, Motil rarely recorded the mortgages. In fact, Motil admitted under oath during his 
Section 341(a) bankruptcy hearing, that he only recorded mortgages “a couple times, if . . . asked.”  
26. Motil’s failure to record the mortgages not only contradicted his written and oral 
assurances to investors, it also enabled Motil to sell multiple Notes “collateralized” by the same 
property to different investors. If prospective investors searched county title records, they would 
be  unable  to discover that  the  property  purportedly  collateralizing their  investment  was  already 
encumbered by a mortgage. Motil knew, or was reckless in not knowing, that the properties were 
not secured by first mortgages simply because there could only be one first mortgage, and, in many 
instances, Motil had already issued mortgages on the same property to numerous investors.  
III. Motil Forged A Notary’s Signature and Misused A Notary Seal On Investors’ 
Mortgages 
 
27. In October 2018, Motil hired an assistant who was tasked with, among other things, 
obtaining a notary commission and notarizing mortgage agreements. The assistant carried out her 
task of notarizing mortgages until September 2019, when Motil gave her a new assignment. 
28. Motil then forged her signature as a notary and affixed a counterfeit version of her 
notary seal to mortgages.  Beginning in approximately September 2019, Motil forged the notary’s 
signature and affixed her seal on at least thirty mortgages. This continued even after the notary left 
Motil’s  employ  in  February  2020. By  forging  her signature  and  falsely affixing  her  seal,  Motil 
intentionally or recklessly caused the mortgages to become un-recordable under Ohio law. Motil 
intentionally or recklessly failed to t ell    investors that he was forging a notary’s signature and seal 
on  their  “mortgages.”  This  omission  was  material because  a reasonable  investor  would  have  
wanted to know that Motil – the expert “Cash Flow King” who had helped hundreds of investors, 
in whom they were placing their trust – was falsifying a notary’s stamp and signature on official 
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documents. 
29. Motil’s former employee filed a formal police report after she learned that he had 
forged her signature and used a counterfeit version of her notary seal. 
IV. Motil Misled Investors By Failing to Disclose That He Sold Multiple Notes Secured 
by Single Properties 
 
30. Motil intentionally sold multiple Notes, each supposedly collateralized by a single 
property, to dozens of investors, defrauding them of millions of dollars.  
31. From November  2017  to  May  2021,  Motil  sold  Notes  that  were  all  purportedly  
collateralized by the same residential property located at 13410 Wainfleet Avenue in Cleveland 
(the  “Wainfleet  Property”)  to at  least  fifteen  separate  investors,.  Though Motil acquired  the 
Wainfleet  Property  (through  a  Motil  LLC)  in  November  2017  for  only  $35,000,  he  used  the  
property  to  “collateralize”  Notes  worth  at  least  $502,971. When  Motil  sold  his  last  Wainfleet 
Property Note, he owed at least $393,000 to at least 12 investors, bringing the total outstanding 
principal to $433,000. At the time, home valuation services Corelogic, Quantarium, and Collateral 
Analytics valued the Wainfleet Property at between $60,745 and $76,000.  
32. Similarly,  Motil  intentionally  or  recklessly  sold  Notes that  were  all  purportedly 
collateralized by the same single-family residence located at 13529 Leroy Avenue in Cleveland 
(the “Leroy Property”) to at least seventeen investors. Though Motil bought the Leroy Property 
(through a Motil LLC) in August 2017 for $51,000, he used the property to “collateralize” Notes 
worth at  least  $853,000.  When Motil  sold  his  last  Note  purportedly  collateralized  by  the  Leroy  
Property  in  April  2021,  he  owed  over  $610,000  to  12  investors, bringing  the  total  outstanding  
principal  to  over  $635,000.  Corelogic, Quantarium,  and  Collateral  Analytics  never  valued  the  
property at more than $118,600.  
33. Beginning  in November  2019, Motil intentionally  or  recklessly  sold  Notes  that 
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were all purportedly collateralized by the same multi-family property located at 4027 Rocky River 
Drive, in Cleveland (the “Rocky River Property”) to at least ten investors.  Motil bought the Rocky 
River  Property  (through  a  Motil  LLC)  in  December  2018  for  $931,000,  but  used  it  to  
“collateralize”  Notes  worth  over  $2.6 million. By May  2020,  when  Motil  sold  his  last  Note 
“collateralized”  by  the  Rocky  River  Property,  he  owed  investors  in  the  property a  total  of  over  
$2.2 million. One of Motil’s investor victims, Investor A, lost approximately $429,240 from her 
IRA account on the Rocky River Property alone. (See infra ¶¶ 42-47). 
34. Beginning  in  November  2017,  Motil  intentionally  or  recklessly  sold  Notes  that 
were all  purportedly  collateralized  by  the  same  property  located  at  3318  Hearthstone  Road  in  
Parma,  Ohio,  (the  “Hearthstone  Property”)  to  at  least  twenty  investors.  Motil  bought  the  
Hearthstone  Property  in  November  2017  for  only  $47,000,  but  by  January  2021,  had  used  it  to  
“collateralize”  notes  worth  over  $1.3   million.  Corelogic,  Quantarium,  and  Collateral  Analytics  
never  valued  the  property as  worth  more  than  $130,000. When  Motil  sold  his  last  note  on  the  
Hearthstone Property, he owed investors in the property a total of over $1.1 million. 
35. Beginning  in  September  2019,  Motil  intentionally  or  recklessly  sold  Notes  that 
were all  purportedly  collateralized  by  the  same  property  located  at  3593  West  50
th
  Street  in  
Cleveland,  Ohio  (the  “W  50
th
  Street  Property”)  to  at  least  ten  investors.  He  bought  the  W  50
th
 
Street  Property  in  September  2019  for  only  $30,000,  but  by  January  2021,  had  used  it  to  
“collateralize” notes worth over $330,000. By January 2021, Motil owed investors approximately 
$307,000.  
36. Motil intentionally  or  recklessly  failed  to  tell investors  in  the  Wainfleet,  Leroy,  
Rocky River, Hearthstone, and W 50
th
 Street Properties that he had already sold multiple Notes on 
the same properties. And he intentionally or recklessly failed to inform investors that he intended 
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to continue to encumber the already-overburdened properties with additional “mortgages.” 
37. These misstatements – and Motil’s failures   to disclose to investors that there were 
already existing liens on these properties – were material. Reasonable investors would have wanted 
to know that these properties were grossly over-leveraged and that other investors were already 
promised a share of whatever “profits” Motil expected to earn.  
V. Motil Misused Investors’ Funds on Ponzi Payments and Personal Expenses 
38. Motil intentionally misappropriated the funds transferred by investors to the Chase 
Accounts by making Ponzi payments, moving money to businesses unrelated to real estate, and 
paying personal expenses. Overall, during the Relevant Period, Motil raised over $11 million from 
unsuspecting  investors.  He  used over  $3.7 million (or 33%) on  Ponzi  payments;  over  $900,000 
(9%) on transfers to other businesses unrelated to real estate, $400,000 on transfers to his wife, 
and $1.6 million on personal expenses.  
39. These personal expenses included over $1,000,000 in personal credit card charges, 
over $107,000 on a seven-month rental of a lakeside mansion; over $73,000 for courtside seats to 
the  Cleveland  Cavaliers;  over  $45,000 to  repay  student  loans;  over $37,000  on  purchases  from 
Best  Buy;  over $23,000  on  “Leeny’s  Lean  Body”;  over  $22,000  on  iTunes,  over  $14,000  at  
Starbucks;  over  $13,900  at  numerous pizzerias;  and  $58,000 in  cash withdrawals.  Motil never 
disclosed that any investor funds would be used on Ponzi payments, on unrelated businesses, or 
on personal expenses, let alone approximately 60% of investor money. 
40. Without a constant inflow of new money from investors, Motil’s operations were 
unsustainable because the cash income from his real estate business operations was insufficient to 
make payments due to investors,  make payments to other businesses,  and to pay personal expenses. 
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VI. Specific Examples of Motil’s Fraud and Misuse of Investor Funds 
A. Investor A 
41. Investor  A,  a  resident  of  Massachusetts, learned  about  investing  with  Motil in 
approximately August 2018. After making contact with Motil, Investor A scheduled a phone call 
to discuss Motil’s investment opportunities. During their ensuing discussion, Motil said, among 
other things, that Investor A would be “like a bank” and that her investment would be secured by 
a mortgage on a multi-family residential property in Ohio. During the discussion, and in later e-
mails, Investor A made clear that she would be investing her retirement funds, which was or should 
have been obvious to Motil because Investor A was transferring her funds from her 401k account 
into a self-directed IRA account.  
1. Investor A’s Initial Investment: Rocky River Property  
42. Motil  offered  Investor  A  an  18-month Note  with  a  12%  APR  that  would  pay  
monthly interest of $4,380 and a balloon payment of $438,000, consisting of the entire invested 
amount of $429,240 plus a 2% bonus at the end of the 18-month term. This Note listed the Rocky 
River Property described in ¶ 33, supra, as collateral. Relying on Motil’s representations, Investor 
A agreed in October 2018 to invest with a Motil LLC in a Note with a face amount of $438,000 
(the “Rocky River Note”). Motil also gave Investor A a document titled “Mortgage” that prohibited 
Motil from encumbering the Rocky River Property. 
43. On  or  about  November  19,  2018,  Investor  A  authorized  the  transfer  of $429,240 
from her self-directed IRA into an NS Sales Chase Account to fund her investment in the Rocky 
River Note. Immediately thereafter, Motil misused Investor A’s funds by making Ponzi payments 
totaling  at  least  $85,000  to  twenty  investors ($16,000  to  individual  investors  and  $69,000 to 
institutional investors). He also used over $47,000 to pay personal credit cards and over $20,000 
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to pay personal expenses such as $3,100 for student loans, $2,500 to “Leeny’s Lean Body” and 
$1,330 to iTunes.  
44. Motil’s statements to Investor A concerning the Rocky River Note were materially 
false  and  misleading.  Motil never  told Investor  A  that  her  investment  would  be  used  to  pay  
personal  expenses  and  to  make  Ponzi  payments  owed to  other  unsuspecting  investors. A 
reasonable investor would have wanted to know that Motil did not intend to use her investment for 
business purposes.  
45. Motil also failed to tell Investor A that he needed additional financing to acquire 
the Rocky River Property, which would deprive her of the “first position” lien he had promised. 
Motil ultimately borrowed, and personally guaranteed the prompt payment of, $845,000 from an 
institutional lender that held a first position lien on the Rocky River Property. In December 2018, 
Motil purchased the Rocky River Property in the name of a Motil LLC,  using $765,000 from the 
institutional  loan  and  $228,000  from Investor  A’s  funds  (roughly  half  of  what  Investor  A  
provided).  By issuing the mortgage to the institutional lender, Motil disregarded the provision in 
Investor  A’s  Rocky  River  Mortgage  which  prohibited  him  from  encumbering  the  Rocky  River  
Property. The institutional lender could not determine that Motil had previously issued a mortgage 
to Investor A because Motil omitted it from the loan documents provided to the lender and because 
Motil failed to record Investor A’s Rocky River Mortgage.  
46. Even after Motil borrowed $845,000 from the institutional lender, he disregarded 
the terms  of  that  mortgage  by  issuing  eight additional Notes and  mortgages  to eight separate 
investors totaling at least $1,386,000, all purportedly collateralized by the Rocky River Property. 
Motil never informed Investor A about the other investors who were holding notes secured by the 
Rocky River Property. These omissions were material because a reasonable investor would have 
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wanted to know that the property supposedly securing her investment was grossly overleveraged 
and that another investor had priority over her. 
47. Motil’s  Ponzi  scheme  lacked  a  sufficient,   legitimate  source  of  cash  to  fund  his  
operations, such as rent, property resale, or cash-out refinances—material facts that Motil omitted 
to tell Investor A or other prospective investors. Because he lacked a sufficient,  legitimate source 
of cash, Motil took funds from other unsuspecting investors to make monthly Ponzi payments to 
Investor A, but he never paid the $438,000 principal due on the Rocky River Note. 
2. Investor A’s Modification & Second Investment: The Olivesburg Property 
48. By  September  2019,  Investor  A  had  accumulated  approximately  $49,500 in  her 
self-directed IRA. This amount included $40,880 of interest payments received in connection with 
Investor A’s Rocky River Note and additional IRA contributions. Motil contacted Investor A and 
explained that the $49,500 cash  balance  in  her  IRA was not  earning  interest.  He  suggested that 
Investor A instead invest those funds in another Note.  Motil offered Investor A a $48,000 Note 
“secured”  by  a  property  located  at  6220  Olivesburg  Fitchville  Road  in  Greenwich,  Ohio  (the  
“Olivesburg Property”).  
49. On or about September 30, 2019, Investor A agreed to invest the $48,000, and Motil 
sent  her  a Note  signed by  Motil  on  behalf  of  a  Motil  LLC  (“Investor  A’s  Olivesburg Note”). 
Investor A’s Olivesburg Note had a stated effective interest rate of 11%, and instead of providing 
periodic interest payments,  had a scheduled one-time balloon repayment of $66,278 due in October 
2022. On or about September 30, 2019, Investor A followed Motil’s instructions to authorize her 
IRA  Custodian  to  make  the  $48,000 transfer  to  the  NS  Sales  Chase  Account.   Motil  provided  
Investor A with an Olivesburg Note and an accompanying document titled “Mortgage.” 
50. Although Investor A’s Olivesburg Note was supposed to be secured by a mortgage 
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on  the  Olivesburg  Property,  Motil  never  recorded  Investor  A’s  mortgage,  leaving  Investor  A’s  
Olivesburg  Note  unsecured.  Furthermore,  when  Motil  solicited  Investor  A  to invest  in  Investor 
A’s Olivesburg Note, he had already issued one “mortgage” on the Olivesburg Property to Investor 
B (see  infra  ¶¶ 62-63)  and  a  second  “mortgage”  on  the  same  property  for  $200,000  to  another  
investor.  
51. Because Motil never recorded the prior “mortgages,”  there was no way that Investor 
A could have discovered the prior encumbrance on the Olivesburg Property. Motil intentionally or 
recklessly failed to inform Investor A about the other investors who were already holding notes 
secured  by  the  Olivesburg  Property.  This  omission  was  material  because  a  reasonable  investor  
would have wanted to know that the supposed “security” for their investment already served as 
the  “security”  for  two  other  larger  loans.  Motil  never  paid  the  $66,278  due  on  Investor  A’s  
Olivesburg Note.  
3. Investor A’s Third Investment: Hearthstone Road 
52. In  or  about  mid-January  2021,  Motil  offered  Investor  A  yet another  investment 
opportunity: a $100,000 Note,  secured by a property located at 3318 Hearthstone Road in Parma, 
Ohio.  On or about January 27, 2021, Investor A agreed, investing $100,000 in a Hearthstone Note 
that was scheduled to pay $1,250 monthly interest (15% APR) for 6 months and a final balloon 
repayment of $100,000 at the end of the 6-month term (“Investor A’s Hearthstone Note”).  On or 
about January 27, 2021, Investor A followed Motil’s instructions and transferred $100,000 from 
her  savings  account  to the  NS  Sales  Chase Account.   Motil provided  Investor  A  with  her  
Hearthstone Note,  which  he signed  on  behalf  of  a Motil  LLC.   Motil also  sent  Investor  A  a 
document titled “Mortgage.”   
53. When  Motil  offered  Investor  A’s  Hearthstone Note,  he  failed to  disclose  that  he  
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had been experiencing severe cash flow difficulties—specifically,  that he had experienced a deficit 
between rents collected and expenses for taxes, property repairs and money owed to investors and 
banks. Indeed, Motil admitted as much two months later, in a March 22, 2021 e-mail to investors 
(see infra ¶ 74). In the March 22, 2021 e-mail, Motil also explained: “sometime around the end of 
2020, [he] realized if things didn’t improve, it wasn’t sustainable and we would need to make a 
drastic move that we really didn’t want to do - liquidate.” Motil intentionally or recklessly failed 
to disclose this to Investor A before her January 27, 2021 investment. This omission was material 
because  a  reasonable  investor  would  have  wanted  to  know  that  Motil  was  contemplating 
liquidating his assets while, at the same time, seeking investments. 
54. By January 2021, when Motil offered Investor A her Hearthstone Note, Motil owed 
at least  fourteen  other  investors  payment  on  approximately  $1  million  in  investments  that  were 
purportedly  secured  by  the  Hearthstone  Property.  Motil  failed  to  record  the  fourteen  investors’  
mortgages, or Investor A’s mortgage.
1
 Motil intentionally or recklessly failed to inform Investor 
A about the other investors who were already holding notes secured by the Hearthstone Property. 
This  omission  was  material  because  a  reasonable  investor  would  have  wanted  to  know  that  the 
Hearthstone Property was massively overleveraged and provided little, if any security. 
55. As  with  Investor  A’s  previous  investments,  Motil  failed  to record Investor  A’s  
Hearthstone mortgage, leaving Investor A’s Hearthstone Note unsecured. Motil also did not pay 
any  of  the  monthly  interest  on  Investor  A’s  Hearthstone Note.  When  her  monthly  interest  went  
unpaid, Investor A frantically tried to reach Motil, who failed to respond to her e-mails and phone 
calls. Motil failed to pay Investor A the $100,000 balloon payment that became due in July 2021. 
 
1
 One of the Hearthstone Property investors recorded his own mortgage shortly before Investor A 
received her Note and Mortgage. A second investor recorded a “deed affidavit”, to which his 
Hearthstone Property Mortgage was attached. 
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56. The value  of  the  Hearthstone  Property  was  far  less  than  the  $1.1 million  Motil 
owed. Motil bought the Hearthstone Property in November 2017, for only $47,000. By January 
2021, (when  Motil  offered  Investor  A’s  Hearthstone Note),  valuation services  Quantarium,  
Corelogic, and Collateral Analytics valued the Hearthstone Property at $117,752, $123,600, and 
$130,000, respectively. Thus, investors were collectively under-collateralized by at least $970,000.  
57. Motil defrauded  Investor A  of  at  least  $577,240: her  $429,240  investment  in  the  
Rocky River Property, $48,000 investment in the Olivesburg Property and $100,000 investment 
in the Hearthstone Property. This was virtually all of Investor A’s life savings and retirement funds. 
B. Investor B 
58. Investor  B,  a  Texas  resident,  is  a Lieutenant  Colonel  in  the  U.S.  Air  Force  who 
learned  about  Motil’s  investments  from  another  investor  on  a  social  media  website  called 
“Biggerpockets.com.” Investor B contacted Motil and scheduled a phone call with him in January 
2019. During  the  phone  call  (which Investor  B  recorded), Investor  B  told  Motil  that  he  was 
interested  in  investing  his  and  his  wife’s  IRA  retirement  money.  Motil  acknowledged  his  
responsibility  to  investors  who  trusted  him  with  their  retirement  funds  and  life  savings  and  
explained  that  his  investments  were  relatively  low  risk.  Motil  told  Investor  B  that  he  never  
defaulted on a Note and was very proud of his reputation among investors. 
59. During the  January  2019  telephone  call,  Motil  also explained  that  he  typically  
bought single-family houses for between $25,000 and $50,000, and that he rehabbed and did the 
necessary construction on the property. Motil explained that, after the renovations, the properties 
would be worth between $80,000 and $200,000 and he would then find tenants, resell the houses, 
or restructure the debt long term.  
60. During the January 2019 telephone call, Motil also told Investor B that he would 
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be an investor in a Note. Motil repeatedly assured him that the Notes would be collateralized by a 
first position mortgage on a property and further protected by an insurance policy that protected 
Investor  B  in  case  Motil  suffered  a  catastrophic  loss.  Motil  told  Investor  B  that  the  mortgages 
collateralizing the Notes would be filed so that if a title company performed a search, it would see 
Investor B’s lien on the property. Motil also told Investor B that the range of annual rate of returns 
on his Notes ranged from 10% to 15%, but that he liked 12% to make computations “easier for his 
team.”  
61. Relying on Motil’s representations,  Investor B made a series of 4 investments in 
Notes totaling $175,300 from April 2019 to November 2019 as set forth below. 
Property 
Collateralizing 
Note 
Principal 
Amount 
APR 
% 
Scheduled  
Monthly 
Payment  
Term Balloon 
Repayment  
Amount  
6220 Olivesburg 
Fitchville Road, 
Greenwich, 
Ohio 
$61,000 12% $613 April, 2019- 
May, 2020 
$61,000 
3318 
Hearthstone 
Road, Parma, 
Ohio 
 
$64,300 12% $643 October 1, 
2019-  
November 1, 
2020 
$64,300 
13410 Wainfleet 
Ave., 
Cleveland, Ohio 
$25,000 12% $250 November 8, 
2019-December 
1, 2020 
$25,000 
11722 
Longmead Ave., 
Cleveland, Ohio 
$25,000 12% $250 December 8, 
2019-December 
1, 2020 
$25,000 
1. Investor B’s First Investment: The Olivesburg Property  
62. In or about April 2019, Investor B agreed to enter into a Note with Motil for $61,000 
that was to be collateralized by the Olivesburg Property—the   same property that Motil would use 
five months later  in  September  2019  to  supposedly collateralize Investor  A’s  Olivesburg Note 
(supra ¶ 48).  Motil sent Investor B his version of the Note (“Investor B’s Olivesburg Note”) and 
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sent Investor B a document titled “Mortgage.” Motil signed both the Mortgage and the Investor 
B’s Olivesburg Note on behalf of a Motil LLC.  Motil intentionally or recklessly failed to inform 
Investor B that, at the time, another investor already held a note and “mortgage” of $200,000 on 
the same property (supra ¶ 50). On or about April 11, 2019, Investor B followed Motil’s deposit 
instructions and initiated a request that a $61,000 check be drawn from his IRA account and sent 
to an NS Management Chase Account.  
63. On June 17, 2020, Motil paid the outstanding principal and interest on Investor B’s 
Olivesburg Note.  Bank records show that Motil received money at 4:16 pm on June 17, 2020 from 
another investor, then paid $65,104.67 to Investor B at    5:13 pm that same day.  Motil intentionally 
or  recklessly  failed  to  disclose  that  this  was  a  Ponzi  Payment,  not  derived  from  any  legitimate  
source, such as rents from or the sale or refinance of the Olivesburg Property (or any other real 
estate operations). The omission was material because reasonable investors would have wanted to 
know that Motil’s business was not creating sufficient profits to pay back his investments and that 
Motil was instead relying on new investments –   in short, that Motil was operating a Ponzi scheme. 
2. Investor B’s Second Investment: Hearthstone Road 
 
64. In or about October 2019, Motil solicited Investor B to enter into another Note that 
would be supposedly collateralized by a first lien on the Hearthstone Property. Motil would later 
use this same property to collateralize Investor A’s Hearthstone Note in January 2021 (supra ¶¶ 
52-56). Motil intentionally or recklessly failed to disclose that he had already issued at least five 
outstanding Notes  totaling  $295,000  to  different  investors,  all     purportedly collateralized by  this  
one property. Investor B’s Hearthstone Note had a $64,300 principal  amount, was scheduled to 
pay 12% APR monthly from November 1, 2019 to November 1, 2020, and had a final $64,300 
balloon principa  l repayment also due on November 1, 2020. (“Investor B’s Hearthstone Note”). 
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After Investor  B  transferred  $64,300  to  the  NS  Sales  Chase  Account,  Motil sent Investor  B’s 
Hearthstone  Note,  via  a  Motil  LLC.  Motil  also  sent  Investor  B  a  document  titled  “Mortgage.” 
Motil  made  sporadic interest  payments  on Investor  B’s  Hearthstone Note  totaling  just  over  
$10,000, but never paid the $64,300 balloon payment that became due on November 1, 2020. 
3. Investor B’s Wainfleet Ave. and Longmead Ave. Investments 
65. On or about November 8, 2019, Motil offered Investor B two additional Notes, each 
for principal amounts of $25,000 and monthly interest payments yielding 12% from December 1, 
2019 to December 1, 2020, with a balloon repayment of principal at the end of the 12-month term. 
Motil represented to Investor B that the Notes would be secured by residential properties located 
in Cleveland. By their respective terms, one $25,000 Note was collateralized by a property located 
at 11722 Longmead Ave., in Cleveland, Ohio, (the “Longmead Property”).  Motil signed the Note 
on  behalf  of  a  Motil  LLC  (the  “Longmead  Note”).  The other $25,000  Note  stated  that  it  was  
collateralized by the Wainfleet Property described in ¶ 31, supra. Motil signed the Note on behalf 
of  a  Motil  LLC  (the  “Wainfleet  Note”).  On  or  about  November  12,  2019,  Investor  B  followed  
Motil’s instructions and transferred a total of $50,000 to the NS Sales Chase Account. 
66. Motil intentionally or recklessly failed to disclose to Investor B that he had already 
issued several Notes purportedly collateralized by the Longmead and Wainfleet P roperties. When 
Motil issued the  Longmead  Note  to  Investor  B,  he  already  issued  at least one  Note  to  another  
investor that was collateralized by the Longmead property, with a balance of $60,000. When Motil 
sold the Wainfleet Note to Investor B,  there already were four outstanding Notes collateralized by 
that property, totaling $172,000. After Investor B made his Wainfleet Property investment, Motil 
issued    at  least  nine more Notes purportedly  collateralized  by  the  Wainfleet  Property,  totaling 
$276,000. Motil also intentionally or recklessly failed to disclose these subsequent investments to 
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Investor B. Only one of those subsequent investors was repaid his principal ($40,000), resulting in 
$433,000  worth of  outstanding  Notes  that  were  purportedly  collateralized  by  the  Wainfleet  
Property. Motil’s  omissions  relating  to  the  Longmead  and  Wainfleet  Properties  were  material  
because reasonable investors would have wanted to know that the properties that “secured”   their 
investments were massively overleveraged and, therefore, largely useless as collateral. 
67. From December  1,  2019  to February  10,  2021,  Motil  made  Ponzi  Payments to 
Investor  B  on the  Wainfleet Note and the Longmead  Note, but  failed  to  make  any  principal  
payments thereafter. By the end of February 2021, all three of Investor B’s balloon payments were 
at least two months past due. Investor B told Motil that he needed to receive his overdue payments 
because he was being deployed to Afghanistan and would not be able to communicate from there. 
Motil then  stopped  responding to  Investor  B’s  attempts  to  reach  him. At  one  point,  Investor  B 
became  so  frustrated,  he  posted comments  on  Motil’s  Facebook  page  describing  his  negative 
experience.  Motil responded  by  blocking  Investor  B from  posting  anything  more,  and  e-  mailed 
Investor  B  that  negative  comments were  not  helpful  in  his  effort  to  find  a  “replacement”  for 
Investor  B. In other  words,  Motil  told  Investor  B  that  his  negative  posts  were  unhelpful  in  his  
efforts to lure another victim to invest. 
C. Investor C 
68. Investor C, a Florida resident, is  a professor primarily involved in cancer research 
at  a medical  college. In  approximately  late  June  2018,  Investor  C  became  aware  of  Motil  by  
watching podcasts  in which Motil discussed real estate investment strategies that helped “out of 
town”  investors  make  money. Investor  C  signed  up  for  Motil’s  newsletters  and  investment 
opportunities and received Motil’s lists of “Private Lending Opportunities” approximately once a 
month. In or about late October 2020, Investor C selected a six-month Note with a face amount of 
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$80,000 that paid 15% annual interest,  with an $80,000 balloon payment at    maturity from among 
Motil’s “opportunities.” Motil listed the value of the property at $120,000. 
69. On or about October 30, 2020, after talking with Motil, Investor C wired   $80,000 
from his bank account located in Florida into the NS Sales Chase Account.  Motil sent Investor C 
a Note for $80,000 that stated that it was collateralized by the Hearthstone Property (“Investor C’s 
Hearthstone  Note”).  Motil  also  sent  Investor  C  a  document  titled  “Mortgage.”  Motil  signed  the 
Mortgage  and  Investor  C’s  Hearthstone  Note  on  behalf  of  a Motil LLC.  Motil  intentionally  or  
recklessly failed to disclose to Investor C that he had already issued numerous Notes purportedly 
secured  by  the  Hearthstone  Property.  (See  supra,  ¶¶  52-56, 64.) Motil also  intentionally  or  
recklessly failed to inform Investor C that he continued to issue Notes secured by the Hearthstone 
Property. (Id.) These omissions were material because reasonable investors would have wanted to 
know that the properties supposedly securing their investments were grossly overleveraged. 
70. Motil  used  Investor  C’s  $80,000 to  make  Ponzi Payments  to  other  investors. 
Afterwards, Motil made a total of three payments of $1,000 to Investor C on November 30, 2020, 
January 26, 2021 and February 1, 2021. Each of these payments were themselves Ponzi Payments 
made using investments by new investors. In fact, Motil used a portion of Investor A’s investment 
(also collateralized by the Hearthstone Property) to make the $1,000 February 1 interest payment 
to Investor C. Motil intentionally or recklessly failed to disclose the source of these payments to 
Investor C. The omission was material because reasonable investors would have wanted to know 
that  Motil’s  business  was  not  creating  sufficient  profits  to  pay  back  their  investments  and  that  
Motil was operating a Ponzi scheme, using new investments to pay back earlier investors. 
71. After  February  2021, Motil stopped making  any  further  interest  payments,  and 
failed to make the $80,000 balloon payment due on May 1, 2021. As he had with other investors, 
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Motil simply stopped responding to Investor C’s e-mails and phone calls. 
72. Motil’s misrepresentations to Investors A, B, and C, and his misuse of their investor 
funds  are  representative  of  his  interactions  and  fraudulent  acts  towards  other  victims  in  Motil’s  
Ponzi scheme. 
VII. Motil’s Further Misstatements and Omissions to Investors 
73. As  Motil’s  Ponzi  scheme  crumbled, he tried to  mollify  a  growing  number  of  
panicked investors by sending mass e-mails that failed to disclose the true nature of his scheme 
and the problems he was facing. In one e-mail dated January 13, 2021, Motil explained that he had 
experienced challenging  cash  flow  issues  in  August  2020 resulting  from  banking  and  tenant  
payment matters. He assured investors that he had everything back on track and that things were 
going smoothly. In the same e-mail, Motil claimed that he had to track down his largest property 
manager  for  payment.  He assured  investors  that  he  was  working  on  building  up  a  larger  cash  
reserve and apologized for the poor communication.  
74. In a second e-mail dated March 22, 2021, Motil explained, among other things, that 
he had experienced consistent cash flow difficulties over the previous few months. Motil wrote 
that he experienced a deficit between rent collections on the one hand, and money due to investors, 
banks,  property repairs,  and taxes  on  the  other.  Motil  told  investors  that  he  recorded  a  podcast  
predicting future events in the shifting landscape of landlording. However, Motil explained that he 
did  not  want to  release  his podcast  and  “let  the  world  know”  what  was  going  on  in  the  market 
before he “moved on our stuff.” Motil stated that he was not pressing the panic button, and falsely 
assured investors that he had enough equity in the properties to repay all investors.  
75. In  both the  January  13  e-mail and the  March  22  e-mail,  Motil  intentionally  or  
recklessly failed to include any information that he used investor money to pay personal expenses 
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and  make  Ponzi  Payments. Similarly,  the  e-mails  omitted  any  explanation  about  how  Motil 
diverted investor money to other businesses unrelated to real estate. Moreover, Motil’s March 22, 
2021  e-mail  was  affirmatively  false  and  misleading  because  contrary  to  Motil’s  assertions,  the 
properties lacked  sufficient equity  to  pay  investors. These  false  and  misleading  statements  and  
omissions were material because reasonable investors would have wanted to know that Motil had 
misused investor funds, that Motil was only able to pay back investors by using new investor funds, 
and that Motil lacked the equity to pay back investors. 
76. Even after sending the January 13 and March 22 e-mails, Motil continued to solicit 
investors to purchase Notes purportedly secured by the same properties. 
VIII. Amy Motil Receives Ill-Gotten Gains from Motil’s Fraudulent Scheme 
77. Throughout the relevant period, Motil transferred (directly or indirectly) more than 
$400,000 from the Chase Accounts to his wife Amy Motil or for her benefit. Amy Motil has no 
legitimate  claim  to  the  ill-gotten  funds  and  has  been  unjustly  enriched  by  her  receipt  of  these  
investor funds. Amy Motil should therefore be required to disgorge all of the amounts she directly 
or indirectly received from Motil, as well as to pay prejudgment interest on such amounts. 
FIRST CLAIM FOR RELIEF 
Violations of Sections 5(a) and 5(c) of the Securities Act 
(All Defendants) 
78. The Commission re-alleges and incorporates by reference each and every allegation 
contained in Paragraphs 1 through 77 of this Complaint as if fully set forth herein. 
79. By engaging in the acts and conduct alleged in this Complaint, during the Relevant 
Period,  Defendants,  directly  or  indirectly,  singly  or  in  concert,  made  use  of  the  means  or  
instruments of transportation or communication in interstate commerce or of the mails to offer to 
sell securities through the use or medium of a prospectus or otherwise, or carried or caused to be 
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26 
 
carried  through  the  mails  or  in  interstate  commerce,  by  means  or  instruments  of  transportation,  
securities for the purpose of sale or for delivery after sale, when no registration statement had been 
filed or was in effect as to such securities, and when no exemption from registration was applicable. 
The Notes that defendants offered and sold as alleged herein constitute “securities” as defined in 
the  Securities  Act,  and as  to  those  with  terms  of  nine  months  or  greater,  were  required  to  be  
registered with the Commission. 
80. By reason of the foregoing, Defendants have violated, and, unless restrained and 
enjoined, will continue to violate Sections 5(a) and 5(c) of the Securities Act [15 U.S.C. §§ 77e(a) 
and (c)]. 
SECOND CLAIM FOR RELIEF 
Violations of Section 10(b) and Rule 10b-5 of the Exchange Act 
(All Defendants) 
81. The Commission re-alleges and incorporates by reference each and every allegation 
contained in Paragraphs 1 through 77 of this Complaint as if fully set forth herein. 
82. By engaging in the acts and conduct alleged in this Complaint, during the Relevant 
Period,  Defendants  directly  or  indirectly,  singly  or  in  concert,  by  the  use  of  the  means  and  
instrumentalities of interstate commerce or of the mails, in connection with the purchase or sale of 
securities,  with  scienter  have:  (a)  employed  devices,  schemes,  or  artifices  to  defraud,  (b)  made  
untrue statements of material fact and omitted to state a material fact necessary in order to make 
the statements made, in light of the circumstances under which they were made, not misleading, 
and (c) engaged in acts, practices, and courses of business which operated or would operate as a 
fraud or deceit upon other persons. 
83. By  reason  of  the  foregoing,  Defendants  have  violated,  and,  unless  enjoined,  will  
continue to violate, Section 10(b) of the Exchange Act [15 U.S.C. § 78j(b)] and Rule 10b-5 [17 
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C.F.R. § 240.10b-5], promulgated thereunder. 
THIRD CLAIM FOR RELIEF 
Violations of Section 17(a) of the Securities Act 
(All Defendants) 
84. The Commission re-alleges and incorporates by reference each and every allegation 
contained in Paragraphs 1 through 77 of this Complaint as if fully set forth herein. 
85. By engaging in the acts and conduct alleged in this Complaint, during the Relevant 
Period, Defendants, directly or indirectly, singly or in concert, by use of the means or instruments 
of transportation or communication in interstate commerce, or of the mails, in the offer or sale of 
securities, with scienter have: (a) employed devices, schemes, and artifices to defraud; (b) obtained 
money or property by means of untrue statements of a material fact or omissions to state a material 
fact necessary in order to make statements made, in light of the circumstances under which they 
were  made,  not  misleading;  and  (c)  engaged  in  transactions,  practices,  and  courses  of  business 
which operated or would have operated as a fraud or deceit upon purchasers. 
86. By  reason  of  the  foregoing,  Defendants  have  violated,  and,  unless  enjoined,  will  
continue to violate, Section 17(a) of the Securities Act [15 U.S.C. § 77q(a)]. 
FOURTH CLAIM FOR RELIEF 
Unjust Enrichment Liability 
(Relief Defendant Amy Motil) 
87. The Commission re-alleges and incorporates by reference each and every allegation 
contained in Paragraphs 1 through 77 of this Complaint as if fully set forth herein. 
88. Relief  Defendant  has  obtained  funds  as  part,  and  in  furtherance  of,  the  securities  
violations alleged above, and under circumstances in which it is not just, equitable, or conscionable 
for her to retain the funds. As a consequence, Relief Defendant has been unjustly enriched. 
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PRAYER FOR RELIEF 
 WHEREFORE, the Commission respectfully requests that this Court enter judgment: 
I. 
Permanently restraining and enjoining Defendants, their agents, servants, employees and 
attorneys, and all persons in active concert or participation with them, who receive actual notice 
of  the  injunction  by  personal  service  or  otherwise,  and  each  of  them,  from  committing  future  
violations of each of the securities laws and rules promulgated thereunder as alleged herein and 
from participating directly or indirectly in the issuance of purchase, offer or sale of any security 
(provided that such order would not prevent the buying and selling securities listed on a national 
securities exchange for their respective personal account). 
II. 
Permanently barring Motil from acting as an officer or director of any issuer that has a 
class of securities registered pursuant to Section 12 of the Exchange Act [15 U.S.C. § 78l] and 
that is required to file reports under Section 15(d) of the Exchange Act [15 U.S.C. § 78o(d)] 
pursuant to Section 20(e) of the Securities Act [15 U.S.C. § 78t(e)] and Section 21(d)(2) of the 
Exchange Act [15 U.S.C. § 78u(d)(2)].  
III. 
Directing Defendants to disgorge all ill-gotten gains, with prejudgment interest, on a joint 
and several basis, with prejudgment interest thereon. 
IV. 
Ordering Relief Defendant to disgorge all funds obtained as part, and in furtherance of, 
the securities violations alleged above, with prejudgment interest thereon. 
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V. 
Ordering each of the Defendants to pay civil money penalties pursuant to Section 20(d) 
of the Securities Act [15 U.S.C. § 77t(d)] and Section 21(d)(3) of the Exchange Act [15 U.S.C. 
§ 78u(d)(3)]. 
VI. 
Creating a Fair Fund pursuant to Section 308(a) of the Sarbanes-Oxley Act. 
VII. 
Granting such other and further relief as the Court may deem just and appropriate for the 
protection of investors pursuant to Section 21(d)(5) of the Exchange Act [15 U.S.C. §78u(d)(5)]. 
JURY DEMAND 
Pursuant to Rule 38 of the Federal Rules of Civil Procedure, the SEC hereby demands trial 
by jury. 
 
Dated:  September 25, 2023       Respectfully submitted, 
       /s/ John B. Timmer   
  
John B. Timmer (D.C. Bar No. 997309) 
[email protected] 
 
COUNSEL FOR PLAINTIFF 
Securities and Exchange Commission 
       100 F Street, N.E. 
Washington, DC 20549 
       T: (202) 551-7687 
        
 
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UNITED STATES DISTRICT COURT 
NORTHERN DISTRICT OF OHIO 

EASTERN DIVISION 
                                        
    ) 
SECURITIES AND EXCHANGE COMMISSION,  ) 
      ) 
                               Plaintiff,       ) CASE NO.  23-CV-1853               
v.      ) 
      ) 
MATTHEW M. MOTIL                                                       ) 
NORTH SHORE EQUITY SALES, LLC, d/b/a    ) JURY DEMANDED  
THE MARIE PAUL COMPANY;    )  
NORTH SHORE EQUITY MANAGEMENT, LLC;      ) 
     ) 
                                Defendants,    ) 
    )    
AMY DOUBRAVA MOTIL,    ) 
     ) 
 Relief Defendant.    ) 
                                                       ) 

 
COMPLAINT 

   
Plaintiff, the Securities and Exchange Commission (“SEC”), alleges as follows:  

SUMMARY 

1. For almost four years, Matthew M. Motil (“Motil”) devised and carried out an 

offering fraud and Ponzi scheme that defrauded investors of millions of dollars. He promised 

investors short-term, low-risk, and high-return promissory notes supposedly fully collateralized by 

first mortgages on residential real estate located throughout Ohio. Motil falsely told investors that 

he would use their investments to renovate the properties and pay them back with profits from 

reselling the properties, refinancing them, or renting them. Nearly everything about his scheme 

was a lie. Many of the promissory notes he offered and sold to investors were not “fully 

collateralized by first mortgages” because Motil purposely issued multiple promissory notes 

“secured” by the same property to numerous investors.  

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2. In one instance, Motil obtained over $1.3 million from at least twenty separate 

investors, issuing at least twenty notes “secured” by one single-family home that was purchased 

for $47,000 and never valued at more than $130,000. Despite promising many investors that he 

would record their mortgages, Motil failed to do so. Ultimately, Motil used investor funds to (1) 

make over $3.7 million in Ponzi payments; (2) spend over $1.6 million on personal expenses; (3) 

divert over $900,000 of investors’ money to other businesses unrelated to real estate, and (4) route 

hundreds of thousands more to his wife, Amy Doubrava Motil (“Amy Motil” or “Relief 

Defendant”). Motil intentionally or recklessly failed to disclose any of this to his investors. 

3. From as early as October 2017 through May 2021 (the “Relevant Period”), Motil, 

operating through North Shore Equity Sales, LLC d/b/a The Marie Paul Company (“NS Sales”), 

North Shore Equity Management, LLC (“NS Management”) and a variety of other LLCs that he 

created, raised over $11 million from more than 60 investors located across the United States. 

Motil persuaded individuals, including a cancer researcher and an active-duty U.S. Air Force 

Lieutenant Colonel, to invest their retirement funds and life savings with him by advertising his 

own financial acumen and track record of success.  

4. After Motil’s Ponzi scheme collapsed, he filed for personal bankruptcy in March 

2022, seeking to discharge the millions of dollars he personally owed to the investors he had 

victimized. In his bankruptcy petition, Motil failed to divulge that his debts were from his Ponzi 

scheme. Instead, Motil identified the victimized investors as his “creditors,” claiming that his 

personal debts arose from “guarantees of debts of [Motil] LLCs.” However, in response to the 

Amended Complaint filed by the U.S. Trustee in its adversarial proceeding, Motil contended that 

the victim-creditors of his Ponzi scheme are creditors of corporations and LLCs that Motil owned.  

5. Motil actively participated in his bankruptcy case but has ignored numerous SEC 

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administrative subpoenas for testimony and documents served upon him personally.  

6. As a result of the conduct described in this Complaint, the Defendants violated 

Sections 5(a) and (c) and 17(a) of the Securities Act of 1933 (“Securities Act”), [15 U.S.C. §§ 

77e(a), (c), and 77q(a)]; and Section 10(b) and Rule 10b-5 of the Securities Exchange Act of 1934 

(“Exchange Act”), [15 U.S.C. § 78j(b) and 17 C.F.R. §240.10b-5]. Unless restrained and enjoined, 

they are reasonably likely to continue to violate the federal securities laws. 

7. The Commission seeks a judgment from the Court: (i) permanently enjoining the 

Defendants from violating the applicable provisions and rules of the federal securities laws as 

alleged and asserted below; and from participating directly or indirectly in the issuance, purchase, 

offer or sale of any security (provided that such order would not prevent Defendants from buying 

and selling securities listed on a national securities exchange for their respective personal 

accounts); (ii) barring Motil from becoming an officer or director of a public company; (iii) 

directing the Defendants to disgorge all net profits they received as a result of the acts and/or 

courses of conduct complained of, with prejudgment interest; (iv) directing the Defendants to pay 

civil money penalties; (v) creating a Fair Fund pursuant to Section 308(a) of the Sarbanes-Oxley 

Act; (vi) ordering Relief Defendant to disgorge any ill-gotten gains plus prejudgment interest 

thereon; and (vii) granting such other and further relief as this Court may determine to be just, 

equitable, and necessary. 

JURISDICTION AND VENUE 

8. The SEC brings this action pursuant to Section 20(b) of the Securities Act [15 

U.S.C. §77t(b)], and Sections 21(d) and 21(e) of the Exchange Act [15 U.S.C. §§78u(d) and 

78u(e)]. In connection with the conduct described herein, Defendants directly or indirectly made 

use of the means or instrumentality of interstate commerce, or of the mails, in connection with 

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their actions as alleged in this Complaint. Throughout the Relevant Period, Defendants solicited 

and received funds from investors throughout the United States by interstate wire transfers, and 

Motil communicated with and solicited out of state investors via his website, various social media 

accounts, and/or by telephone and e-mail.  

9. Venue is proper in this Court pursuant to Section 27 of the Exchange Act [15 U.S.C. 

§ 78aa]. Motil and Amy Motil reside and can be found in this District, and certain of the acts, 

practices and courses of business constituting the violations alleged herein occurred within this 

District. Specifically, many of the residential real estate properties involved in Motil’s fraud are 

located within this District.  

DEFENDANTS  

10. Motil, age 42, is a resident of North Olmsted, Ohio, and is the owner and principal 

of NS Sales and NS Management and each related party described below. Motil is an Ohio-licensed 

Professional Engineer, and a self-described entrepreneur and real estate expert. Motil holds a Ph.D. 

and an MBA, and has claimed to have a J.D. majoring in Intellectual Property, earned in one year 

from the University of Akron School of Law. Motil created and controlled numerous bank 

accounts at JPMorgan Chase Bank NA in the names of NS Sales, NS Management, the related 

parties (and others) that he used to facilitate the fraudulent scheme described herein (each a “Chase 

Account” and collectively the “Chase Accounts”). On March 7, 2022, Motil filed a voluntary 

petition under Chapter 7 of the Bankruptcy Code for personal bankruptcy in the Bankruptcy Court 

for the Northern District of Ohio.  

11. NS Sales is an Ohio LLC created and controlled by Motil with its principal place 

of business in Ohio. NS Sales also used a number of registered trade names including “The Marie 

Paul Company.” NS Sales held properties and issued promissory notes to investors that contained 

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materially false and misleading statements and/or omissions. Motil instructed investors to deposit 

their money into a Chase Account in the name of NS Sales. Motil used the funds in the NS Sales 

Chase Account for personal expenditures, as well as to make payments due to previous investors 

(“Ponzi Payments”) and to businesses unrelated to real estate. NS Sales is not registered with the 

Commission in any capacity. 

12. NS Management is an Ohio LLC created and controlled by Motil with its principal 

place of business in Ohio. Like NS Sales, NS Management held properties and issued promissory 

notes to investors that contained materially false and misleading statements and/or omissions. 

Motil also requested that some investors transfer their money to a Chase Account in the name of 

NS Management. Motil used the funds in the NS Management Chase Account for personal 

expenditures, as well as to make Ponzi Payments and payments to businesses unrelated to real 

estate. Motil also transferred investor funds from the Chase Account in the name of NS Sales to 

the Chase Account in the name of NS Management, where it was used to make Ponzi Payments, 

to pay personal expenses and make payments to businesses unrelated to real estate.  

RELIEF DEFENDANT 

13. Amy Motil, age 35, is married to Motil and resides in North Olmsted, Ohio. Certain 

banking records list Amy Motil as “COO” and 50% owner of NS Sales, and as a “Member” of NS 

Management. Amy Motil received at least $400,000 of investor money.  

RELATED PARTIES 

14. BUYCLE112, LLC; BUYCLE114, LLC; BUYCLE158, LLC; BUYCLE175, LLC; 

BUYCLE176, LLC; INVCLE150, LLC; NS Equity Cleveland, LLC; NSEM Mansfield 1, LLC; 

and NSEM Mansfield 2, LLC (each a “Motil LLC” and together “the Motil LLCs”) are all Ohio 

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LLCs that were created and controlled by Motil. The Motil LLCs held real estate and/or issued 

promissory notes that contained materially false and misleading statements and/or omissions.  

FACTS 

I. Motil’s Solicitation Efforts 

15. During the Relevant Period, Motil described himself as a self-made real estate 

entrepreneur who helped “hundreds of investors throughout the world to create massive wealth 

through real estate.” He advertised himself using his website at http://www.drmattmotil.com (the 

“Motil Website”) and numerous social media accounts (including accounts at Facebook, LinkedIn 

and Biggerpockets.com) and podcasts. 

16. The Motil Website told prospective investors that Motil had “investment 

opportunities ranging from $10,000 to $10 million,” and invited those who visited the website to 

“Be a Real Estate Investing Badass!” and to “fire [their] boss, quit [their] 9 to 5, and build a 

business/lifestyle [they] love earning a passive income from real estate investments.” The Motil 

Website and Motil’s social media accounts offered links to podcasts on Apple and YouTube 

entitled “The Cash Flow King, The Realest Real Estate Podcast,” hosted by “Doctor Motil.”  

17. A former employee of Motil testified under oath that they believed that the podcast 

was part of a broader media presentation to convince people to invest with Motil and his 

companies. Motil released approximately 147 episodes of the podcast. 

18. In one podcast dated November 8, 2019 titled “Funding Back Private Money,” 

Motil talked at length about the “huge level of responsibility” that comes with accepting real estate 

investments from individuals. He said:  

When someone has worked at a job or a business . . . there’s a 
significant level of effort that has gone into the creation of that 
capital. And so when [people] are willing to take that [money] and 
hand it to you in good faith, [there’s an obligation] that you’re going 

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to turn it around and give them a nice return on their money. They 
have put a lot of faith in you. And you have a significant level of 
responsibility to make sure that, not only are you doing what you 
said you were going to do, but you give them the return that you 
promised. . . . [w]e don’t do unsecured notes so . . . we’re doing a 
promissory note and a mortgage, one investor-one deal and so 
you’re first lien position on the property, just like a bank. 

 
(emphasis added). When Motil made this statement, which he knew or recklessly failed to know 

was false, he had already defrauded numerous investors; after making this statement, he continued 

to defraud investors for well over a year.  

19. Through the Motil Website and certain social media accounts he controlled, Motil 

invited visitors to submit their e-mail address to receive copies of his newsletter and to schedule a 

call to speak with him directly. Once investors signed up for the newsletter or scheduled a phone 

call, Motil typically solicited them directly by e-mail with “private lending opportunities” that 

briefly described, in bullet-point format, several promissory notes.  

20. The descriptions included: (i) their principal amounts; the applicable annual 

percentage rate (“APR”) (usually 8%-15%); (ii) the term (usually 6-18 months); and sometimes 

(iii) a brief description of the residential property that would collateralize the promissory note 

(such as the number of bedrooms and baths and a property valuation estimate). Motil does not 

appear to have attempted to screen accredited investors. 

21. In his conversations with investors, Motil often told them, among other things, that 

he bought houses, renovated them, and either sold them at a profit or refinanced them and rented 

them. He often emphasized that investors would play an entirely passive role and they would not 

need to participate in the renovation, rental or refinancing of the property. Motil told multiple 

investors that they essentially would be “acting as a bank” because their funds would be secured 

by a first position mortgage lien on the property and they would receive interest payments and, at 

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the end of the term, their principal. Motil knew or recklessly failed to know that this was false. 

Motil also told investors on numerous occasions (sometimes in writing and sometimes orally) that 

after he received their investment he would record the mortgage with the county clerk, knowing 

or recklessly failing to know that this was false.  

II. The Investments Offered By Motil 

22. After an investor selected a particular investment from among Motil’s list of 

“private lending opportunities,” Motil created and issued a promissory note corresponding to the 

investor’s choice (the “Notes”). The Notes set forth, among other things, the APR, the repayment 

schedule, the address of the property that would purportedly collateralize the Note, and the name 

of the entity (usually a Motil LLC, but sometimes NS Sales or NS Management) that Motil 

identified as the borrower. Motil signed the Notes on behalf of the borrower. 

23. Motil also sent investors a document he created titled “Mortgage.” The mostly-

boilerplate language in the Mortgages generally contained covenants prohibiting Motil from 

creating or accruing any debt, lien or charge that would have priority over the Note received by 

the investor. The covenants in the Mortgages underscored what Motil told many investors orally: 

their investments were collateralized by first position mortgages on residential properties. 

24.  In addition to the Notes and Mortgages, Motil also sent payment instructions for 

investors to fund their Note. Motil typically instructed investors to send their money to a Chase 

Account. Motil specifically told numerous investors that after he received their money he would 

record the mortgage and they would receive a signed copy of the recorded mortgage mailed 

directly from the appropriate county clerk.  

25. Motil often told investors that the county clerks were backlogged and that it took 

several weeks or months to send their recorded mortgages. But Motil was just buying time. He 

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knew that county clerks could not possibly mail a copy of the recorded mortgages because, among 

other things, Motil rarely recorded the mortgages. In fact, Motil admitted under oath during his 

Section 341(a) bankruptcy hearing, that he only recorded mortgages “a couple times, if . . . asked.”  

26. Motil’s failure to record the mortgages not only contradicted his written and oral 

assurances to investors, it also enabled Motil to sell multiple Notes “collateralized” by the same 

property to different investors. If prospective investors searched county title records, they would 

be unable to discover that the property purportedly collateralizing their investment was already 

encumbered by a mortgage. Motil knew, or was reckless in not knowing, that the properties were 

not secured by first mortgages simply because there could only be one first mortgage, and, in many 

instances, Motil had already issued mortgages on the same property to numerous investors.  

III. Motil Forged A Notary’s Signature and Misused A Notary Seal On Investors’ 
Mortgages 
 
27. In October 2018, Motil hired an assistant who was tasked with, among other things, 

obtaining a notary commission and notarizing mortgage agreements. The assistant carried out her 

task of notarizing mortgages until September 2019, when Motil gave her a new assignment. 

28. Motil then forged her signature as a notary and affixed a counterfeit version of her 

notary seal to mortgages. Beginning in approximately September 2019, Motil forged the notary’s 

signature and affixed her seal on at least thirty mortgages. This continued even after the notary left 

Motil’s employ in February 2020. By forging her signature and falsely affixing her seal, Motil 

intentionally or recklessly caused the mortgages to become un-recordable under Ohio law. Motil 

intentionally or recklessly failed to tell investors that he was forging a notary’s signature and seal 

on their “mortgages.” This omission was material because a reasonable investor would have 

wanted to know that Motil – the expert “Cash Flow King” who had helped hundreds of investors, 

in whom they were placing their trust – was falsifying a notary’s stamp and signature on official 

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documents. 

29. Motil’s former employee filed a formal police report after she learned that he had 

forged her signature and used a counterfeit version of her notary seal. 

IV. Motil Misled Investors By Failing to Disclose That He Sold Multiple Notes Secured 
by Single Properties 

 
30. Motil intentionally sold multiple Notes, each supposedly collateralized by a single 

property, to dozens of investors, defrauding them of millions of dollars.  

31. From November 2017 to May 2021, Motil sold Notes that were all purportedly 

collateralized by the same residential property located at 13410 Wainfleet Avenue in Cleveland 

(the “Wainfleet Property”) to at least fifteen separate investors,. Though Motil acquired the 

Wainfleet Property (through a Motil LLC) in November 2017 for only $35,000, he used the 

property to “collateralize” Notes worth at least $502,971. When Motil sold his last Wainfleet 

Property Note, he owed at least $393,000 to at least 12 investors, bringing the total outstanding 

principal to $433,000. At the time, home valuation services Corelogic, Quantarium, and Collateral 

Analytics valued the Wainfleet Property at between $60,745 and $76,000.  

32. Similarly, Motil intentionally or recklessly sold Notes that were all purportedly 

collateralized by the same single-family residence located at 13529 Leroy Avenue in Cleveland 

(the “Leroy Property”) to at least seventeen investors. Though Motil bought the Leroy Property 

(through a Motil LLC) in August 2017 for $51,000, he used the property to “collateralize” Notes 

worth at least $853,000. When Motil sold his last Note purportedly collateralized by the Leroy 

Property in April 2021, he owed over $610,000 to 12 investors, bringing the total outstanding 

principal to over $635,000. Corelogic, Quantarium, and Collateral Analytics never valued the 

property at more than $118,600.  

33. Beginning in November 2019, Motil intentionally or recklessly sold Notes that 

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were all purportedly collateralized by the same multi-family property located at 4027 Rocky River 

Drive, in Cleveland (the “Rocky River Property”) to at least ten investors. Motil bought the Rocky 

River Property (through a Motil LLC) in December 2018 for $931,000, but used it to 

“collateralize” Notes worth over $2.6 million. By May 2020, when Motil sold his last Note 

“collateralized” by the Rocky River Property, he owed investors in the property a total of over 

$2.2 million. One of Motil’s investor victims, Investor A, lost approximately $429,240 from her 

IRA account on the Rocky River Property alone. (See infra ¶¶ 42-47). 

34. Beginning in November 2017, Motil intentionally or recklessly sold Notes that 

were all purportedly collateralized by the same property located at 3318 Hearthstone Road in 

Parma, Ohio, (the “Hearthstone Property”) to at least twenty investors. Motil bought the 

Hearthstone Property in November 2017 for only $47,000, but by January 2021, had used it to 

“collateralize” notes worth over $1.3 million. Corelogic, Quantarium, and Collateral Analytics 

never valued the property as worth more than $130,000. When Motil sold his last note on the 

Hearthstone Property, he owed investors in the property a total of over $1.1 million. 

35. Beginning in September 2019, Motil intentionally or recklessly sold Notes that 

were all purportedly collateralized by the same property located at 3593 West 50th Street in 

Cleveland, Ohio (the “W 50th Street Property”) to at least ten investors. He bought the W 50th 

Street Property in September 2019 for only $30,000, but by January 2021, had used it to 

“collateralize” notes worth over $330,000. By January 2021, Motil owed investors approximately 

$307,000.  

36. Motil intentionally or recklessly failed to tell investors in the Wainfleet, Leroy, 

Rocky River, Hearthstone, and W 50th Street Properties that he had already sold multiple Notes on 

the same properties. And he intentionally or recklessly failed to inform investors that he intended 

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to continue to encumber the already-overburdened properties with additional “mortgages.” 

37. These misstatements – and Motil’s failures to disclose to investors that there were 

already existing liens on these properties – were material. Reasonable investors would have wanted 

to know that these properties were grossly over-leveraged and that other investors were already 

promised a share of whatever “profits” Motil expected to earn.  

V. Motil Misused Investors’ Funds on Ponzi Payments and Personal Expenses 

38. Motil intentionally misappropriated the funds transferred by investors to the Chase 

Accounts by making Ponzi payments, moving money to businesses unrelated to real estate, and 

paying personal expenses. Overall, during the Relevant Period, Motil raised over $11 million from 

unsuspecting investors. He used over $3.7 million (or 33%) on Ponzi payments; over $900,000 

(9%) on transfers to other businesses unrelated to real estate, $400,000 on transfers to his wife, 

and $1.6 million on personal expenses.  

39. These personal expenses included over $1,000,000 in personal credit card charges, 

over $107,000 on a seven-month rental of a lakeside mansion; over $73,000 for courtside seats to 

the Cleveland Cavaliers; over $45,000 to repay student loans; over $37,000 on purchases from 

Best Buy; over $23,000 on “Leeny’s Lean Body”; over $22,000 on iTunes, over $14,000 at 

Starbucks; over $13,900 at numerous pizzerias; and $58,000 in cash withdrawals. Motil never 

disclosed that any investor funds would be used on Ponzi payments, on unrelated businesses, or 

on personal expenses, let alone approximately 60% of investor money. 

40. Without a constant inflow of new money from investors, Motil’s operations were 

unsustainable because the cash income from his real estate business operations was insufficient to 

make payments due to investors, make payments to other businesses, and to pay personal expenses. 

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VI. Specific Examples of Motil’s Fraud and Misuse of Investor Funds 

A. Investor A 

41. Investor A, a resident of Massachusetts, learned about investing with Motil in 

approximately August 2018. After making contact with Motil, Investor A scheduled a phone call 

to discuss Motil’s investment opportunities. During their ensuing discussion, Motil said, among 

other things, that Investor A would be “like a bank” and that her investment would be secured by 

a mortgage on a multi-family residential property in Ohio. During the discussion, and in later e-

mails, Investor A made clear that she would be investing her retirement funds, which was or should 

have been obvious to Motil because Investor A was transferring her funds from her 401k account 

into a self-directed IRA account.  

1. Investor A’s Initial Investment: Rocky River Property  

42. Motil offered Investor A an 18-month Note with a 12% APR that would pay 

monthly interest of $4,380 and a balloon payment of $438,000, consisting of the entire invested 

amount of $429,240 plus a 2% bonus at the end of the 18-month term. This Note listed the Rocky 

River Property described in ¶ 33, supra, as collateral. Relying on Motil’s representations, Investor 

A agreed in October 2018 to invest with a Motil LLC in a Note with a face amount of $438,000 

(the “Rocky River Note”). Motil also gave Investor A a document titled “Mortgage” that prohibited 

Motil from encumbering the Rocky River Property. 

43. On or about November 19, 2018, Investor A authorized the transfer of $429,240 

from her self-directed IRA into an NS Sales Chase Account to fund her investment in the Rocky 

River Note. Immediately thereafter, Motil misused Investor A’s funds by making Ponzi payments 

totaling at least $85,000 to twenty investors ($16,000 to individual investors and $69,000 to 

institutional investors). He also used over $47,000 to pay personal credit cards and over $20,000 

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to pay personal expenses such as $3,100 for student loans, $2,500 to “Leeny’s Lean Body” and 

$1,330 to iTunes.  

44. Motil’s statements to Investor A concerning the Rocky River Note were materially 

false and misleading. Motil never told Investor A that her investment would be used to pay 

personal expenses and to make Ponzi payments owed to other unsuspecting investors. A 

reasonable investor would have wanted to know that Motil did not intend to use her investment for 

business purposes.  

45. Motil also failed to tell Investor A that he needed additional financing to acquire 

the Rocky River Property, which would deprive her of the “first position” lien he had promised. 

Motil ultimately borrowed, and personally guaranteed the prompt payment of, $845,000 from an 

institutional lender that held a first position lien on the Rocky River Property. In December 2018, 

Motil purchased the Rocky River Property in the name of a Motil LLC, using $765,000 from the 

institutional loan and $228,000 from Investor A’s funds (roughly half of what Investor A 

provided). By issuing the mortgage to the institutional lender, Motil disregarded the provision in 

Investor A’s Rocky River Mortgage which prohibited him from encumbering the Rocky River 

Property. The institutional lender could not determine that Motil had previously issued a mortgage 

to Investor A because Motil omitted it from the loan documents provided to the lender and because 

Motil failed to record Investor A’s Rocky River Mortgage.  

46. Even after Motil borrowed $845,000 from the institutional lender, he disregarded 

the terms of that mortgage by issuing eight additional Notes and mortgages to eight separate 

investors totaling at least $1,386,000, all purportedly collateralized by the Rocky River Property. 

Motil never informed Investor A about the other investors who were holding notes secured by the 

Rocky River Property. These omissions were material because a reasonable investor would have 

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wanted to know that the property supposedly securing her investment was grossly overleveraged 

and that another investor had priority over her. 

47. Motil’s Ponzi scheme lacked a sufficient, legitimate source of cash to fund his 

operations, such as rent, property resale, or cash-out refinances—material facts that Motil omitted 

to tell Investor A or other prospective investors. Because he lacked a sufficient, legitimate source 

of cash, Motil took funds from other unsuspecting investors to make monthly Ponzi payments to 

Investor A, but he never paid the $438,000 principal due on the Rocky River Note. 

2. Investor A’s Modification & Second Investment: The Olivesburg Property 

48. By September 2019, Investor A had accumulated approximately $49,500 in her 

self-directed IRA. This amount included $40,880 of interest payments received in connection with 

Investor A’s Rocky River Note and additional IRA contributions. Motil contacted Investor A and 

explained that the $49,500 cash balance in her IRA was not earning interest. He suggested that 

Investor A instead invest those funds in another Note. Motil offered Investor A a $48,000 Note 

“secured” by a property located at 6220 Olivesburg Fitchville Road in Greenwich, Ohio (the 

“Olivesburg Property”).  

49. On or about September 30, 2019, Investor A agreed to invest the $48,000, and Motil 

sent her a Note signed by Motil on behalf of a Motil LLC (“Investor A’s Olivesburg Note”). 

Investor A’s Olivesburg Note had a stated effective interest rate of 11%, and instead of providing 

periodic interest payments, had a scheduled one-time balloon repayment of $66,278 due in October 

2022. On or about September 30, 2019, Investor A followed Motil’s instructions to authorize her 

IRA Custodian to make the $48,000 transfer to the NS Sales Chase Account. Motil provided 

Investor A with an Olivesburg Note and an accompanying document titled “Mortgage.” 

50. Although Investor A’s Olivesburg Note was supposed to be secured by a mortgage 

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on the Olivesburg Property, Motil never recorded Investor A’s mortgage, leaving Investor A’s 

Olivesburg Note unsecured. Furthermore, when Motil solicited Investor A to invest in Investor 

A’s Olivesburg Note, he had already issued one “mortgage” on the Olivesburg Property to Investor 

B (see infra ¶¶ 62-63) and a second “mortgage” on the same property for $200,000 to another 

investor.  

51. Because Motil never recorded the prior “mortgages,” there was no way that Investor 

A could have discovered the prior encumbrance on the Olivesburg Property. Motil intentionally or 

recklessly failed to inform Investor A about the other investors who were already holding notes 

secured by the Olivesburg Property. This omission was material because a reasonable investor 

would have wanted to know that the supposed “security” for their investment already served as 

the “security” for two other larger loans. Motil never paid the $66,278 due on Investor A’s 

Olivesburg Note.  

3. Investor A’s Third Investment: Hearthstone Road 

52. In or about mid-January 2021, Motil offered Investor A yet another investment 

opportunity: a $100,000 Note, secured by a property located at 3318 Hearthstone Road in Parma, 

Ohio. On or about January 27, 2021, Investor A agreed, investing $100,000 in a Hearthstone Note 

that was scheduled to pay $1,250 monthly interest (15% APR) for 6 months and a final balloon 

repayment of $100,000 at the end of the 6-month term (“Investor A’s Hearthstone Note”). On or 

about January 27, 2021, Investor A followed Motil’s instructions and transferred $100,000 from 

her savings account to the NS Sales Chase Account. Motil provided Investor A with her 

Hearthstone Note, which he signed on behalf of a Motil LLC. Motil also sent Investor A a 

document titled “Mortgage.”  

53. When Motil offered Investor A’s Hearthstone Note, he failed to disclose that he 

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had been experiencing severe cash flow difficulties—specifically, that he had experienced a deficit 

between rents collected and expenses for taxes, property repairs and money owed to investors and 

banks. Indeed, Motil admitted as much two months later, in a March 22, 2021 e-mail to investors 

(see infra ¶ 74). In the March 22, 2021 e-mail, Motil also explained: “sometime around the end of 

2020, [he] realized if things didn’t improve, it wasn’t sustainable and we would need to make a 

drastic move that we really didn’t want to do - liquidate.” Motil intentionally or recklessly failed 

to disclose this to Investor A before her January 27, 2021 investment. This omission was material 

because a reasonable investor would have wanted to know that Motil was contemplating 

liquidating his assets while, at the same time, seeking investments. 

54. By January 2021, when Motil offered Investor A her Hearthstone Note, Motil owed 

at least fourteen other investors payment on approximately $1 million in investments that were 

purportedly secured by the Hearthstone Property. Motil failed to record the fourteen investors’ 

mortgages, or Investor A’s mortgage.1 Motil intentionally or recklessly failed to inform Investor 

A about the other investors who were already holding notes secured by the Hearthstone Property. 

This omission was material because a reasonable investor would have wanted to know that the 

Hearthstone Property was massively overleveraged and provided little, if any security. 

55. As with Investor A’s previous investments, Motil failed to record Investor A’s 

Hearthstone mortgage, leaving Investor A’s Hearthstone Note unsecured. Motil also did not pay 

any of the monthly interest on Investor A’s Hearthstone Note. When her monthly interest went 

unpaid, Investor A frantically tried to reach Motil, who failed to respond to her e-mails and phone 

calls. Motil failed to pay Investor A the $100,000 balloon payment that became due in July 2021. 

 
1 One of the Hearthstone Property investors recorded his own mortgage shortly before Investor A 
received her Note and Mortgage. A second investor recorded a “deed affidavit”, to which his 
Hearthstone Property Mortgage was attached. 

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56. The value of the Hearthstone Property was far less than the $1.1 million Motil 

owed. Motil bought the Hearthstone Property in November 2017, for only $47,000. By January 

2021, (when Motil offered Investor A’s Hearthstone Note), valuation services Quantarium, 

Corelogic, and Collateral Analytics valued the Hearthstone Property at $117,752, $123,600, and 

$130,000, respectively. Thus, investors were collectively under-collateralized by at least $970,000.  

57. Motil defrauded Investor A of at least $577,240: her $429,240 investment in the 

Rocky River Property, $48,000 investment in the Olivesburg Property and $100,000 investment 

in the Hearthstone Property. This was virtually all of Investor A’s life savings and retirement funds. 

B. Investor B 

58. Investor B, a Texas resident, is a Lieutenant Colonel in the U.S. Air Force who 

learned about Motil’s investments from another investor on a social media website called 

“Biggerpockets.com.” Investor B contacted Motil and scheduled a phone call with him in January 

2019. During the phone call (which Investor B recorded), Investor B told Motil that he was 

interested in investing his and his wife’s IRA retirement money. Motil acknowledged his 

responsibility to investors who trusted him with their retirement funds and life savings and 

explained that his investments were relatively low risk. Motil told Investor B that he never 

defaulted on a Note and was very proud of his reputation among investors. 

59. During the January 2019 telephone call, Motil also explained that he typically 

bought single-family houses for between $25,000 and $50,000, and that he rehabbed and did the 

necessary construction on the property. Motil explained that, after the renovations, the properties 

would be worth between $80,000 and $200,000 and he would then find tenants, resell the houses, 

or restructure the debt long term.  

60. During the January 2019 telephone call, Motil also told Investor B that he would 

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be an investor in a Note. Motil repeatedly assured him that the Notes would be collateralized by a 

first position mortgage on a property and further protected by an insurance policy that protected 

Investor B in case Motil suffered a catastrophic loss. Motil told Investor B that the mortgages 

collateralizing the Notes would be filed so that if a title company performed a search, it would see 

Investor B’s lien on the property. Motil also told Investor B that the range of annual rate of returns 

on his Notes ranged from 10% to 15%, but that he liked 12% to make computations “easier for his 

team.” 

61. Relying on Motil’s representations, Investor B made a series of 4 investments in 

Notes totaling $175,300 from April 2019 to November 2019 as set forth below. 

Property 
Collateralizing 

Note 

Principal 
Amount 

APR 
% 

Scheduled  
Monthly 
Payment  

Term Balloon 
Repayment  

Amount  
6220 Olivesburg 
Fitchville Road, 

Greenwich, 
Ohio 

$61,000 12% $613 April, 2019- 
May, 2020 

$61,000 

3318 
Hearthstone 

Road, Parma, 
Ohio 

 

$64,300 12% $643 October 1, 
2019-  

November 1, 
2020 

$64,300 

13410 Wainfleet 
Ave., 

Cleveland, Ohio 

$25,000 12% $250 November 8, 
2019-December 

1, 2020 

$25,000 

11722 
Longmead Ave., 
Cleveland, Ohio 

$25,000 12% $250 December 8, 
2019-December 

1, 2020 

$25,000 

1. Investor B’s First Investment: The Olivesburg Property  

62. In or about April 2019, Investor B agreed to enter into a Note with Motil for $61,000 

that was to be collateralized by the Olivesburg Property—the same property that Motil would use 

five months later in September 2019 to supposedly collateralize Investor A’s Olivesburg Note 

(supra ¶ 48). Motil sent Investor B his version of the Note (“Investor B’s Olivesburg Note”) and 

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sent Investor B a document titled “Mortgage.” Motil signed both the Mortgage and the Investor 

B’s Olivesburg Note on behalf of a Motil LLC. Motil intentionally or recklessly failed to inform 

Investor B that, at the time, another investor already held a note and “mortgage” of $200,000 on 

the same property (supra ¶ 50). On or about April 11, 2019, Investor B followed Motil’s deposit 

instructions and initiated a request that a $61,000 check be drawn from his IRA account and sent 

to an NS Management Chase Account.  

63. On June 17, 2020, Motil paid the outstanding principal and interest on Investor B’s 

Olivesburg Note. Bank records show that Motil received money at 4:16 pm on June 17, 2020 from 

another investor, then paid $65,104.67 to Investor B at 5:13 pm that same day. Motil intentionally 

or recklessly failed to disclose that this was a Ponzi Payment, not derived from any legitimate 

source, such as rents from or the sale or refinance of the Olivesburg Property (or any other real 

estate operations). The omission was material because reasonable investors would have wanted to 

know that Motil’s business was not creating sufficient profits to pay back his investments and that 

Motil was instead relying on new investments – in short, that Motil was operating a Ponzi scheme. 

2. Investor B’s Second Investment: Hearthstone Road 
 
64. In or about October 2019, Motil solicited Investor B to enter into another Note that 

would be supposedly collateralized by a first lien on the Hearthstone Property. Motil would later 

use this same property to collateralize Investor A’s Hearthstone Note in January 2021 (supra ¶¶ 

52-56). Motil intentionally or recklessly failed to disclose that he had already issued at least five 

outstanding Notes totaling $295,000 to different investors, all purportedly collateralized by this 

one property. Investor B’s Hearthstone Note had a $64,300 principal amount, was scheduled to 

pay 12% APR monthly from November 1, 2019 to November 1, 2020, and had a final $64,300 

balloon principal repayment also due on November 1, 2020. (“Investor B’s Hearthstone Note”). 

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After Investor B transferred $64,300 to the NS Sales Chase Account, Motil sent Investor B’s 

Hearthstone Note, via a Motil LLC. Motil also sent Investor B a document titled “Mortgage.” 

Motil made sporadic interest payments on Investor B’s Hearthstone Note totaling just over 

$10,000, but never paid the $64,300 balloon payment that became due on November 1, 2020. 

3. Investor B’s Wainfleet Ave. and Longmead Ave. Investments 

65. On or about November 8, 2019, Motil offered Investor B two additional Notes, each 

for principal amounts of $25,000 and monthly interest payments yielding 12% from December 1, 

2019 to December 1, 2020, with a balloon repayment of principal at the end of the 12-month term. 

Motil represented to Investor B that the Notes would be secured by residential properties located 

in Cleveland. By their respective terms, one $25,000 Note was collateralized by a property located 

at 11722 Longmead Ave., in Cleveland, Ohio, (the “Longmead Property”). Motil signed the Note 

on behalf of a Motil LLC (the “Longmead Note”). The other $25,000 Note stated that it was 

collateralized by the Wainfleet Property described in ¶ 31, supra. Motil signed the Note on behalf 

of a Motil LLC (the “Wainfleet Note”). On or about November 12, 2019, Investor B followed 

Motil’s instructions and transferred a total of $50,000 to the NS Sales Chase Account. 

66. Motil intentionally or recklessly failed to disclose to Investor B that he had already 

issued several Notes purportedly collateralized by the Longmead and Wainfleet Properties. When 

Motil issued the Longmead Note to Investor B, he already issued at least one Note to another 

investor that was collateralized by the Longmead property, with a balance of $60,000. When Motil 

sold the Wainfleet Note to Investor B, there already were four outstanding Notes collateralized by 

that property, totaling $172,000. After Investor B made his Wainfleet Property investment, Motil 

issued at least nine more Notes purportedly collateralized by the Wainfleet Property, totaling 

$276,000. Motil also intentionally or recklessly failed to disclose these subsequent investments to 

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Investor B. Only one of those subsequent investors was repaid his principal ($40,000), resulting in 

$433,000 worth of outstanding Notes that were purportedly collateralized by the Wainfleet 

Property. Motil’s omissions relating to the Longmead and Wainfleet Properties were material 

because reasonable investors would have wanted to know that the properties that “secured” their 

investments were massively overleveraged and, therefore, largely useless as collateral. 

67. From December 1, 2019 to February 10, 2021, Motil made Ponzi Payments to 

Investor B on the Wainfleet Note and the Longmead Note, but failed to make any principal 

payments thereafter. By the end of February 2021, all three of Investor B’s balloon payments were 

at least two months past due. Investor B told Motil that he needed to receive his overdue payments 

because he was being deployed to Afghanistan and would not be able to communicate from there. 

Motil then stopped responding to Investor B’s attempts to reach him. At one point, Investor B 

became so frustrated, he posted comments on Motil’s Facebook page describing his negative 

experience. Motil responded by blocking Investor B from posting anything more, and e-mailed 

Investor B that negative comments were not helpful in his effort to find a “replacement” for 

Investor B. In other words, Motil told Investor B that his negative posts were unhelpful in his 

efforts to lure another victim to invest. 

C. Investor C 

68. Investor C, a Florida resident, is a professor primarily involved in cancer research 

at a medical college. In approximately late June 2018, Investor C became aware of Motil by 

watching podcasts in which Motil discussed real estate investment strategies that helped “out of 

town” investors make money. Investor C signed up for Motil’s newsletters and investment 

opportunities and received Motil’s lists of “Private Lending Opportunities” approximately once a 

month. In or about late October 2020, Investor C selected a six-month Note with a face amount of 

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$80,000 that paid 15% annual interest, with an $80,000 balloon payment at maturity from among 

Motil’s “opportunities.” Motil listed the value of the property at $120,000. 

69. On or about October 30, 2020, after talking with Motil, Investor C wired $80,000 

from his bank account located in Florida into the NS Sales Chase Account. Motil sent Investor C 

a Note for $80,000 that stated that it was collateralized by the Hearthstone Property (“Investor C’s 

Hearthstone Note”). Motil also sent Investor C a document titled “Mortgage.” Motil signed the 

Mortgage and Investor C’s Hearthstone Note on behalf of a Motil LLC. Motil intentionally or 

recklessly failed to disclose to Investor C that he had already issued numerous Notes purportedly 

secured by the Hearthstone Property. (See supra, ¶¶ 52-56, 64.) Motil also intentionally or 

recklessly failed to inform Investor C that he continued to issue Notes secured by the Hearthstone 

Property. (Id.) These omissions were material because reasonable investors would have wanted to 

know that the properties supposedly securing their investments were grossly overleveraged. 

70. Motil used Investor C’s $80,000 to make Ponzi Payments to other investors. 

Afterwards, Motil made a total of three payments of $1,000 to Investor C on November 30, 2020, 

January 26, 2021 and February 1, 2021. Each of these payments were themselves Ponzi Payments 

made using investments by new investors. In fact, Motil used a portion of Investor A’s investment 

(also collateralized by the Hearthstone Property) to make the $1,000 February 1 interest payment 

to Investor C. Motil intentionally or recklessly failed to disclose the source of these payments to 

Investor C. The omission was material because reasonable investors would have wanted to know 

that Motil’s business was not creating sufficient profits to pay back their investments and that 

Motil was operating a Ponzi scheme, using new investments to pay back earlier investors. 

71. After February 2021, Motil stopped making any further interest payments, and 

failed to make the $80,000 balloon payment due on May 1, 2021. As he had with other investors, 

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Motil simply stopped responding to Investor C’s e-mails and phone calls. 

72. Motil’s misrepresentations to Investors A, B, and C, and his misuse of their investor 

funds are representative of his interactions and fraudulent acts towards other victims in Motil’s 

Ponzi scheme. 

VII. Motil’s Further Misstatements and Omissions to Investors 

73. As Motil’s Ponzi scheme crumbled, he tried to mollify a growing number of 

panicked investors by sending mass e-mails that failed to disclose the true nature of his scheme 

and the problems he was facing. In one e-mail dated January 13, 2021, Motil explained that he had 

experienced challenging cash flow issues in August 2020 resulting from banking and tenant 

payment matters. He assured investors that he had everything back on track and that things were 

going smoothly. In the same e-mail, Motil claimed that he had to track down his largest property 

manager for payment. He assured investors that he was working on building up a larger cash 

reserve and apologized for the poor communication.  

74. In a second e-mail dated March 22, 2021, Motil explained, among other things, that 

he had experienced consistent cash flow difficulties over the previous few months. Motil wrote 

that he experienced a deficit between rent collections on the one hand, and money due to investors, 

banks, property repairs, and taxes on the other. Motil told investors that he recorded a podcast 

predicting future events in the shifting landscape of landlording. However, Motil explained that he 

did not want to release his podcast and “let the world know” what was going on in the market 

before he “moved on our stuff.” Motil stated that he was not pressing the panic button, and falsely 

assured investors that he had enough equity in the properties to repay all investors.  

75. In both the January 13 e-mail and the March 22 e-mail, Motil intentionally or 

recklessly failed to include any information that he used investor money to pay personal expenses 

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and make Ponzi Payments. Similarly, the e-mails omitted any explanation about how Motil 

diverted investor money to other businesses unrelated to real estate. Moreover, Motil’s March 22, 

2021 e-mail was affirmatively false and misleading because contrary to Motil’s assertions, the 

properties lacked sufficient equity to pay investors. These false and misleading statements and 

omissions were material because reasonable investors would have wanted to know that Motil had 

misused investor funds, that Motil was only able to pay back investors by using new investor funds, 

and that Motil lacked the equity to pay back investors. 

76. Even after sending the January 13 and March 22 e-mails, Motil continued to solicit 

investors to purchase Notes purportedly secured by the same properties. 

VIII. Amy Motil Receives Ill-Gotten Gains from Motil’s Fraudulent Scheme 

77. Throughout the relevant period, Motil transferred (directly or indirectly) more than 

$400,000 from the Chase Accounts to his wife Amy Motil or for her benefit. Amy Motil has no 

legitimate claim to the ill-gotten funds and has been unjustly enriched by her receipt of these 

investor funds. Amy Motil should therefore be required to disgorge all of the amounts she directly 

or indirectly received from Motil, as well as to pay prejudgment interest on such amounts. 

FIRST CLAIM FOR RELIEF 

Violations of Sections 5(a) and 5(c) of the Securities Act 
(All Defendants) 

78. The Commission re-alleges and incorporates by reference each and every allegation 

contained in Paragraphs 1 through 77 of this Complaint as if fully set forth herein. 

79. By engaging in the acts and conduct alleged in this Complaint, during the Relevant 

Period, Defendants, directly or indirectly, singly or in concert, made use of the means or 

instruments of transportation or communication in interstate commerce or of the mails to offer to 

sell securities through the use or medium of a prospectus or otherwise, or carried or caused to be 

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26 
 

carried through the mails or in interstate commerce, by means or instruments of transportation, 

securities for the purpose of sale or for delivery after sale, when no registration statement had been 

filed or was in effect as to such securities, and when no exemption from registration was applicable. 

The Notes that defendants offered and sold as alleged herein constitute “securities” as defined in 

the Securities Act, and as to those with terms of nine months or greater, were required to be 

registered with the Commission. 

80. By reason of the foregoing, Defendants have violated, and, unless restrained and 

enjoined, will continue to violate Sections 5(a) and 5(c) of the Securities Act [15 U.S.C. §§ 77e(a) 

and (c)]. 

SECOND CLAIM FOR RELIEF 

Violations of Section 10(b) and Rule 10b-5 of the Exchange Act 
(All Defendants) 

81. The Commission re-alleges and incorporates by reference each and every allegation 

contained in Paragraphs 1 through 77 of this Complaint as if fully set forth herein. 

82. By engaging in the acts and conduct alleged in this Complaint, during the Relevant 

Period, Defendants directly or indirectly, singly or in concert, by the use of the means and 

instrumentalities of interstate commerce or of the mails, in connection with the purchase or sale of 

securities, with scienter have: (a) employed devices, schemes, or artifices to defraud, (b) made 

untrue statements of material fact and omitted to state a material fact necessary in order to make 

the statements made, in light of the circumstances under which they were made, not misleading, 

and (c) engaged in acts, practices, and courses of business which operated or would operate as a 

fraud or deceit upon other persons. 

83. By reason of the foregoing, Defendants have violated, and, unless enjoined, will 

continue to violate, Section 10(b) of the Exchange Act [15 U.S.C. § 78j(b)] and Rule 10b-5 [17 

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C.F.R. § 240.10b-5], promulgated thereunder. 

THIRD CLAIM FOR RELIEF 

Violations of Section 17(a) of the Securities Act 
(All Defendants) 

84. The Commission re-alleges and incorporates by reference each and every allegation 

contained in Paragraphs 1 through 77 of this Complaint as if fully set forth herein. 

85. By engaging in the acts and conduct alleged in this Complaint, during the Relevant 

Period, Defendants, directly or indirectly, singly or in concert, by use of the means or instruments 

of transportation or communication in interstate commerce, or of the mails, in the offer or sale of 

securities, with scienter have: (a) employed devices, schemes, and artifices to defraud; (b) obtained 

money or property by means of untrue statements of a material fact or omissions to state a material 

fact necessary in order to make statements made, in light of the circumstances under which they 

were made, not misleading; and (c) engaged in transactions, practices, and courses of business 

which operated or would have operated as a fraud or deceit upon purchasers. 

86. By reason of the foregoing, Defendants have violated, and, unless enjoined, will 

continue to violate, Section 17(a) of the Securities Act [15 U.S.C. § 77q(a)]. 

FOURTH CLAIM FOR RELIEF 

Unjust Enrichment Liability 
(Relief Defendant Amy Motil) 

87. The Commission re-alleges and incorporates by reference each and every allegation 

contained in Paragraphs 1 through 77 of this Complaint as if fully set forth herein. 

88. Relief Defendant has obtained funds as part, and in furtherance of, the securities 

violations alleged above, and under circumstances in which it is not just, equitable, or conscionable 

for her to retain the funds. As a consequence, Relief Defendant has been unjustly enriched. 

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PRAYER FOR RELIEF 

 WHEREFORE, the Commission respectfully requests that this Court enter judgment: 

I. 

Permanently restraining and enjoining Defendants, their agents, servants, employees and 

attorneys, and all persons in active concert or participation with them, who receive actual notice 

of the injunction by personal service or otherwise, and each of them, from committing future 

violations of each of the securities laws and rules promulgated thereunder as alleged herein and 

from participating directly or indirectly in the issuance of purchase, offer or sale of any security 

(provided that such order would not prevent the buying and selling securities listed on a national 

securities exchange for their respective personal account). 

II. 

Permanently barring Motil from acting as an officer or director of any issuer that has a 

class of securities registered pursuant to Section 12 of the Exchange Act [15 U.S.C. § 78l] and 

that is required to file reports under Section 15(d) of the Exchange Act [15 U.S.C. § 78o(d)] 

pursuant to Section 20(e) of the Securities Act [15 U.S.C. § 78t(e)] and Section 21(d)(2) of the 

Exchange Act [15 U.S.C. § 78u(d)(2)].  

III. 

Directing Defendants to disgorge all ill-gotten gains, with prejudgment interest, on a joint 

and several basis, with prejudgment interest thereon. 

IV. 

Ordering Relief Defendant to disgorge all funds obtained as part, and in furtherance of, 

the securities violations alleged above, with prejudgment interest thereon. 

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29 
 

V. 

Ordering each of the Defendants to pay civil money penalties pursuant to Section 20(d) 

of the Securities Act [15 U.S.C. § 77t(d)] and Section 21(d)(3) of the Exchange Act [15 U.S.C. 

§ 78u(d)(3)]. 

VI. 

Creating a Fair Fund pursuant to Section 308(a) of the Sarbanes-Oxley Act. 

VII. 

Granting such other and further relief as the Court may deem just and appropriate for the 

protection of investors pursuant to Section 21(d)(5) of the Exchange Act [15 U.S.C. §78u(d)(5)]. 

JURY DEMAND 

Pursuant to Rule 38 of the Federal Rules of Civil Procedure, the SEC hereby demands trial 

by jury. 

 

Dated: September 25, 2023    Respectfully submitted, 

       /s/ John B. Timmer   
  

John B. Timmer (D.C. Bar No. 997309) 
[email protected] 
 
COUNSEL FOR PLAINTIFF 
Securities and Exchange Commission 

       100 F Street, N.E. 
Washington, DC 20549 

       T: (202) 551-7687 
        
 

Case: 1:23-cv-01853  Doc #: 1  Filed:  09/25/23  29 of 29.  PageID #: 29


	UNITED STATES DISTRICT COURT
	NORTHERN DISTRICT OF OHIO
	EASTERN DIVISION