SEC v. PEDRAM ABRAHAM MEHRIAN; STRATEGIC LEGACY INVESTMENT GROUP, INC.; and SLIG HIGH INTEREST LIQUID SAVINGS COMPANY, No. 2:23-cv-08009, Central District of California (Sept. 27, 2023) — Complaint

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DANIEL S. LIM (Cal. Bar No. 292406)
Email:  [email protected]
GARY Y. LEUNG (Cal. Bar No. 302928)
Email:  [email protected]

Attorneys   for Plaintiff
Securities and Exchange Commission
Katharine E. Zoladz, Co-Acting Regional Director
Gary Y. Leung, Associate Regional Director
444 S. Flower Street, Suite 900
Los Angeles, California 90071
Telephone: (323) 965-3998
Facsimile: (213) 443-1904
UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA

SECURITIES AND EXCHANGE
COMMISSION,
Plaintiff,

vs.
PEDRAM ABRAHAM MEHRIAN,
STRATEGIC LEGACY
INVESTMENT GROUP, INC., and
SLIG HIGH INTEREST LIQUID
SAVINGS COMPANY,
Defendants.

 Case No. 2:23-cv-08009

AMENDED COMPLAINT

Plaintiff Securities and Exchange Commission (“SEC”) alleges:
JURISDICTION AND VENUE
1. The Court has jurisdiction over this action pursuant to Sections 20(b),
20(d)(1) and 22(a) of the Securities Act of 1933 (“Securities Act”), 15 U.S.C. §§
77t(b), 77t(d)(1) & 77v(a), and Sections 21(d)(1), 21(d)(3)(A), 21(e) and 27(a) of the
Securities Exchange Act of 1934 (“Exchange Act”), 15 U.S.C. §§ 78u(d)(1),
78u(d)(3)(A), 78u(e) & 78aa(a).
2. Defendants have, directly or indirectly, made use of the means or

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instrumentalities of interstate commerce, of the mails, or of the facilities of a national
securities exchange in connection with the transactions, acts, practices and courses of
business alleged in this complaint.
3. Venue is proper in this district pursuant to Section 22(a) of the Securities
Act, 15 U.S.C. § 77v(a), and Section 27(a) of the Exchange Act, 15 U.S.C. § 78aa(a)
because certain of the transactions, acts, practices, and courses of conduct
constituting violations of the federal securities laws occurred within this district.  In
addition, venue is proper in this district because Defendant Pedram Abraham Mehrian
(“Mehrian”) resides   in this district, an  d Defendants   Strategic Legacy Investment
Group, Inc. (“SLIG”) and SLIG High Interest Liquid Savings Company (“SLIG High
Interest”) (collectively, “Defendants”) have their principal places   of business here.
SUMMARY
4. This civil enforcement action concerns a $17.5 million offering fraud
perpetrated by Defendant Mehrian and his real estate investment companies
Defendants SLIG and SLIG High Interest.
5. From January 2018 through October 2022, Defendants raised at least
$17.5 million from over 150 investors through the unregistered sale of promissory
notes; Defendants told investors that their funds would be used to finance real estate
developments.  Significantly, Defendants took in this eight-figure sum from note
investors through claims about the safety and security of their investment:  that their
promissory notes were “safe” and “secure” because they were “backed by SLIG’s
portfolio of assets”; that the notes were “collateralized” by Defendants’ real estate
portfolio; that the notes would pay “guaranteed interest” above prevailing market
rates offered by banks; and that investments in Defendants’ promissory notes were
“recession-proof.”  These representations, all significant to an objectively reasonable
investor’s decision to invest, were false and misleading.
6. In truth, Defendants improperly treated investor proceeds as one pool of
money, commingled investor funds, regularly moved money among operating

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accounts to meet SLIG’s cash flow needs of the moment, and diverted incoming
investor funds to make Ponzi-like payments to existing investors totaling
approximately $4.2 million.  Last, Defendants failed to inform investors that over the
entire period of the promissory note offering, their real estate development business
had consistently operated at a loss and was incapable of generating enough revenue
from real estate operations to pay promissory note investors their promised returns.
7. By engaging in this conduct, Defendants Mehrian, SLIG, and SLIG High
Interest violated the antifraud provisions of Section 17(a) of the Securities Act, 15
U.S.C. § 77q(a), and Section 10(b) of the Exchange Act, 15 U.S.C. § 78j(b), and Rule
10b-5 thereunder, 17 C.F.R. § 240.10b-5, and violated the registration provisions of
Sections 5(a) and 5(c) of the Securities Act, 15 U.S.C. § 77e(a) and (c).
8. With this complaint, the SEC seeks permanent injunctions prohibiting
Defendants’ future violations of the federal securities laws, disgorgement of
Defendants’ ill-gotten gains together with prejudgment interest, civil penalties from
Defendants, a conduct-based injunction permanently enjoining Defendant Mehrian
from participating in the issuance, purchase, offer, or sale of any security (provided,
however, that such injunction shall not prevent him from purchasing or selling
securities for his own personal account), and an officer and director bar as to
Defendant Mehrian.
THE DEFENDANTS
13. Pedram Abraham Mehrian (“Mehrian”), age 42, is a resident of Los
Angeles, California.  He was the co-founder, president, chief executive officer,
chairman, director, and majority owner of Defendant SLIG, and was the chief
executive officer and a director of Defendant SLIG High Interest.   Defendant
Mehrian exerted managerial control over both entities and related SLIG
entities/subsidiaries.  Defendant Mehrian was associated with a broker-dealer
registered with the Commission from 2002 to 2011.
14. Strategic Legacy Investment Group, Inc. (“SLIG”), is a California

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corporation that was incorporated in 2014, with its principal place of business in Los
Angeles, California.  Defendant SLIG marketed itself as a “private placement
investment firm” focused on real estate development, or as a “private equity” real
estate investment and development firm that offered and sold promissory notes.
Neither Defendant SLIG nor its securities offerings has   ever been registered with the
SEC in any capacity.
15. SLIG High Interest Liquid Savings Company (“SLIG High
Interest”), is a California corporation that was incorporated in 2019, with its
principal place of business in Los Angeles, California.  Defendant SLIG High
Interest, a subsidiary of SLIG, existed to offer and sell promissory notes.  Neither
Defendant SLIG High Interest nor its securities offerings has   ever been registered
with the SEC in any capacity.
THE ALLEGATIONS
A. Defendants’ Securities   Offering
16. From at least January 2018 through October 2022, Defendants SLIG and
SLIG High Interest offered and sold approximately $17.5 million in promissory notes
to over 150 investors across the United States.  Many of Defendants’ promissory note
investors purchased those investments through self-directed IRAs.
17. Defendant SLIG had begun selling promissory notes since 2015, and
Defendant SLIG High Interest had begun selling promissory notes since 2020.
18. The promissory notes offered by both entities were part of one
continuous offering, and Defendant SLIG High Interest’s notes represented that
Defendant SLIG was the guarantor.
19. Defendant Mehrian signed both entities’ promissory notes on behalf of
Defendant SLIG as its president.  For Defendant SLIG’s own promissory notes,
Defendant SLIG was the borrower, and for Defendant SLIG High Interest’s
promissory notes it was the borrower and Defendant SLIG was the guarantor.
20. Defendant Mehrian exercised full decision-making authority over

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Defendants SLIG and SLIG High Interest’s operations.
21. Further, Defendant Mehrian authorized the promissory notes’ use for
offer, purchase, and sale.
22. Additionally, Defendant Mehrian was a signatory on Defendants SLIG
and SLIG High Interest’s bank accounts, and thus controlled how the investor funds
deposited into those accounts were used.
23. Both Defendants SLIG and SLIG High Interest’s promissory notes
offered anywhere between at least 4% and 7.26%, and as high as 9%, in annual
interest, to be paid monthly, quarterly, semi-annually, or accrued, and guaranteed a
return of principal upon maturity, which was typically 12 months.
B. Marketing and General Solicitation of SLIG and SLIG High Interest
Offering
24. Defendants Mehrian, SLIG, and SLIG High Interest engaged in general
solicitation for SLIG and SLIG High Interest’s promissory note offering, marketing
the notes primarily via the internet and emails, and through oral representations to
investors.
25. For example, Defendants made the following representations through
SLIG’s website:
a. Defendant SLIG was “a private equity firm that creates timeless,
trusted real estate projects,” selecting “secure investment projects that will prosper
and grow throughout all economic cycles over time.”
b. Defendant SLIG High Interest was Defendant SLIG’s subsidiary
and “a savings vehicle designed to provide higher returns through its unique
promissory note program,” which helped “ensure the proper administration of all of
SLIG’s assets.”
c. Defendant SLIG’s “High Interest Liquid Savings” investment
option involved issuing promissory notes that were “backed by California lending
laws,” and were “backed by SLIG’s portfolio of assets.”

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d. The High Interest Liquid Savings promissory notes were “safe and
recession-proof,” guaranteed a monthly income, “earn[ed] higher interest,” and
“outpace[d] inflation.”
e. The promissory notes would be issued by Defendant SLIG High
Interest, whose accounts were “collateralized by the real estate portfolio” owned by
Defendant SLIG High Interest.
f. The “$295 million worth of real estate” purportedly consisted of
properties that were described as “income producing asset[s]” and/or generated
“rate[s] of return” from 39.07% to 118.45%.
26. Additionally, Defendant SLIG made the following representations
through emails to prospective and new investors:
a. Defendant SLIG offered “unique investment opportunities in
diverse, flourishing real estate markets across the country,” created a “well-
diversified portfolio that ha[d] out-performed traditional investment options, resulting
in secure and profitable returns,” and had a “current projected portfolio” consisting of
“about $342M of real estate assets in office, multi-family, and senior living spaces.”
b. Defendant SLIG was offering a “SLIG savings account” as an
alternative to a “traditional savings account,” with interest rates ranging from 6.01%
to 8.02% depending how much money was deposited.
27. Furthermore, Defendant SLIG posted a YouTube video titled “SLIG
High Return Liquid Savings” that made the following representations, through
Defendant SLIG’s representatives:
a. Defendant SLIG’s promissory note program provided a “secure
and lucrative” investment alternative to the volatile stock market and traditional
savings accounts, which were “not exciting or worthwhile to savvy investors.”
b. All of Defendant SLIG’s promissory notes were “backed by
California lending laws and by SLIG’s portfolio of assets.”
c. Investors would receive monthly interest payments.

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d. Defendant SLIG offered “the highest interest rate,” and was “safe,
secure.”
e. Investor money would remain liquid and not be “locked.”
28. Moreover, Defendant Mehrian made the following oral representations
directly to investors:
a. Defendant SLIG’s promissory notes provided greater investor
returns than traditional investments.
b. Defendant SLIG’s promissory notes were secured loans, backed
by Defendant SLIG’s real estate holdings and rental revenue.
c. Defendant SLIG’s promissory note investments remained in its
corporate accounts, and were never loaned out for other purposes.
d. Investors would get a check in the mail the first of every month.
e. Defendant SLIG would not automatically renew promissory notes
without first talking to the investor.
f. Real estate investments were better than stock market investments
because the former were more secure, less volatile, and more profitable.
29. Defendants did not attempt to verify the accredited status of promissory
note investors.
C. Violations of the Antifraud Provisions
1. False and Misleading Statements Concerning Use of Investor
Funds
30. Defendants Mehrian, SLIG, and SLIG High Interest made false and
misleading statements to promissory note investors about the safety and security of
the promissory note investment.  Specifically, Defendants failed to disclose that
investor funds were commingled, transferred to other SLIG-related entities to meet
those entities’ cash flow needs, and used to make Ponzi-like payments to other
promissory note    investors.
31. Defendant Mehrian had control over all promissory note investor money,

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and he caused SLIG to treat it as one pool of funds, moving money between various
SLIG-related entities to meet cash flow needs for SLIG’s planned multi-family and
senior living and commercial real estate projects.
32. Defendant Mehrian caused SLIG to document these transfers as loans to,
or investments in, the SLIG project entities, if they were documented at all.
33. Such transfers of promissory note investor money allowed SLIG-related
entities low on cash to continue in operation and allowed the Defendants to portray
SLIG and its network of associated, affiliated, and related entities as a successful real
estate enterprise with significant liquidity, which, as explained below, was a false and
misleading portrayal.
34. From at least January 2018 to October 2022, while the promissory note
offering was still ongoing and SLIG was operating at a net loss, Defendants Mehrian,
SLIG, and SLIG High Interest made at least $4.2 million (out of the $17.5 million
raised) in  Ponzi-like payments—that is, payments to prior promissory note investors
from new investor funds.  For example:
a. In May 2019, $140,800 in Ponzi-like payments were made to
investors, when SLIG’s monthly income was just $11,396.
b. In November 2020, $120,890 in Ponzi-like payments were made
to investors, when SLIG’s monthly income was just $1,427.
c. In January 2022, $20,214 in Ponzi-like payments were made to
investors, when SLIG’s monthly income was just $354.
2. False and Misleading Statements Concerning Profitability and
Ability to Pay Investors
35. Defendants Mehrian and SLIG made false and misleading statements
about Defendant SLIG’s profitability and success, as mentioned above, and never
disclosed that Defendant SLIG was consistently operating at a loss and had negative
equity throughout the relevant period.

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36. Between fiscal years 2016 and 2020, Defendant SLIG’s total liabilities
exceeded $18.3 million, including $13.4 million owed to promissory note investors
and over $4 million payable to other SLIG entities.
37. During this same period, Defendant SLIG’s negative equity was in
excess of $6.3 million.
38. Notably, in March 2020, as investors asked Defendants about not having
received interest payment and for return of principal, Defendants cited the COVID-19
pandemic as an excuse for why they could not pay investors.
39. Specifically, Defendant SLIG sent promissory note investors an
unsigned letter announcing the suspension of interest payments, stating, “This is due
to sources of funds from different financial lenders being delayed resulting from the
continuing uncertainty around COVID-19.”
40. After further inquiries and complaints from investors, Defendants sent
investors a written “Statement of Condition” for SLIG—that Defendant Mehrian co-
signed—representing that SLIG and its subsidiaries “are a well-capitalized and strong
financial investment institution.”
41. In that correspondence, Defendant SLIG represented that: “[b]ased on
our current portfolio and strategic location of assets, we have put ourselves in a
strong and safe position to weather the storm in any economic downturn;”    “[w]e have
cr  eated a safe haven for our investors to invest and preserve capital, backed by our
real estate portfolio;” and “[i]n comparison to other money market accounts with
negative returns, CDs, and other investment vehicles, our Promissory Notes remain
the most lucrative option in the current economic environment.”
42. Following this correspondence, Defendant SLIG sent promissory note
investors monthly statements that set forth the investor’s total principal amount,
interest rate, monthly interest, and, in some cases, a “current value” figure, even
though they did not receive the guaranteed monthly interest payments.

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43. Defendants Mehrian, SLIG, and SLIG High Interest thus engaged in
lulling by continuing to represent to investors that they would still be paid guaranteed
interest payments in the future, and that their principal would eventually be returned,
even after Defendants ceased paying investors’ purportedly guaranteed monthly
interest payments.
44. By year-end 2020, Defendant SLIG lacked sufficient assets to satisfy its
payment obligations to promissory note investors and amounts owed to Defendant
SLIG’s other entities.
45. Further, from 2018 to 2022, Defendant SLIG did not generate sufficient
revenue from its real estate holdings to pay investors their promised returns.
46. During this same period, Defendant SLIG’s operation was funded
entirely from the proceeds derived from the sale of promissory notes.
3. False and Misleading Statements Concerning Automatic
Renewal of Promissory Notes
47. In 2020, despite Defendant Mehrian’s prior representations of
“guaranteed interest” on the notes, and the notes providing no authority for
Defendants to unilaterally defer those interest payments to a later date, Defendant
SLIG unilaterally renewed investors’ promissory notes without advance notice and
without consent of the investors.
48. Defendant SLIG extended the maturity date of the notes by, in some
cases, over a year, depriving investors of the option to forego renewal and to obtain
the return of their principal and accrued, unpaid interest, upon maturity of their
promissory notes.
4. False and Misleading Statements Concerning Investor’s
Purported Collateralized Interest in SLIG’s Real Estate
Portfolio
49. Despite Defendants Mehrian, SLIG, and SLIG High Interest’s
representations that promissory note investments were backed or collateralized by

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Defendants SLIG and SLIG High Interest’s real estate portfolio, the reality was that
the promissory note investments were unsecured and uncollateralized, with no
enforceable interest in real estate.  This was contrary to Defendants’ false and
misleading statements that their investments were more stable than the stock market,
safe, secure, and recession-proof because the promissory notes were backed by real
estate assets and collateralized.
D. Defendants’ False and Misleading Statements Were Material
50. Each of Defendants Mehrian, SLIG, and SLIG High Interest’s false and
misleading statements and omissions were material.
51. A reasonable investor would have considered it important to know that
their money was being used to make Ponzi-like payments to other investors.
52. A reasonable investor also would have considered it important to know
that they were investing their money into a purported real estate development
company—and its related entities—that was consistently operating at a loss with
negative equity from its real estate operations.
53. A reasonable investor further would have considered it important to
know that their notes could be renewed unilaterally without their knowledge or
approval.
54. Finally, a reasonable investor would have considered it important to
know that their funds were not backed or collateralized by any real estate holdings.
55. All of the foregoing facts—misuse of investor funds to make Ponzi-like
payments, consistent operating losses from the real estate projects, deferred interest
payments at Defendants’ unilateral discretion, and note holders having no enforceable
collateral interest in real estate assets—contradicted Defendants’ representations that
their promissory note investments were “safe” and “secure” because they were
“backed by SLIG’s portfolio of assets,” “collateralized” by Defendants’ real estate
portfolio, would pay “guaranteed interest” above prevailing market rates offered by
banks, and were consequently “recession-proof” investments.

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E. Defendants Acted with Scienter and Their Conduct Was Negligent
56. Defendant Mehrian knew, or was reckless in not knowing, that his, and
Defendants SLIG and SLIG High Interest’s, misrepresentations that their promissory
note investments were “safe” and “secure” because they were “backed by SLIG’s
portfolio of assets,” “collateralized” by Defendants’ real estate portfolio, would pay
“guaranteed interest” above prevailing market rates offered by banks, and were
consequently “recession-proof” investments were false and misleading.  For the same
reasons, Defendant Mehrian’s conduct was unreasonable and therefore negligent.
57. Defendant Mehrian’s scienter is attributable to Defendants SLIG and
SLIG High Interest because he, as the president of Defendant SLIG and chief
executive officer of Defendant SLIG High Interest, exerted managerial control over
both entities.
58. Defendant Mehiran’s negligence is attributable to Defendants SLIG and
SLIG High Interest because he, as the President of Defendant SLIG and C.E.O. of
Defendant SLIG High Interest, exerted managerial control over both entities.
F. Defendants Obtained Money By Means of the Misrepresentations
59. Defendants obtained money directly by means of the misrepresentations,
as the promissory note investor money was used to fund SLIG and SLIG High
Interest’s purported real estate operations.
G. The Promissory Notes Offered and Sold by Defendants Are
Securities
60. Based on Defendants’ materially false and misleading statements,
investors invested money into accounts controlled by Defendants in order to receive
returns in the form of fixed interest payments.
61. Defendant Mehrian pooled the investor funds—which investors were
told were collateralized by Defendants SLIG and SLIG High Interest’s real estate
portfolios and investments—into various bank accounts.

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62. The managerial efforts of Defendants SLIG and SLIG High Interest,
with respect to their purported real estate assets and portfolio, were to be led entirely
by Defendants.
63. Promissory note investors were entirely passive, and they reasonably
expected profits based on Defendants’ managerial efforts due to the false and
misleading representations made to them.
G. Registration Violations: Sections 5(a) and 5(c) of the Securities Act

64. Defendants Mehrian, SLIG, and SLIG High Interest offered and sold
securities, raising over $17.5 million from about 150 investors throughout the United
States from at least January 2018 to October 2022.
65. The SLIG and SLIG High Interest offering was never registered with the
SEC.
66. The SLIG and SLIG High Interest securities were offered and sold
through interstate commerce.
67. The SLIG and SLIG High Interest offering was not exempt from
registration.
68. Defendant Mehrian, and Defendants SLIG and SLIG High Interest, as
the issuers of the securities, directly offered and sold securities through general
solicitation, broadly targeting members of the public via the internet.
69. Defendants Mehrian, SLIG, and SLIG High Interest offered and sold
securities to investors residing outside of California.
70. Defendants Mehrian, SLIG, and SLIG High Interest did not take
reasonable steps to verify whether investors residing in the United States were
accredited.
71. Defendant Mehrian is liable for Defendants SLIG and SLIG High
Interest’s offer and sale of securities because he, as the president of Defendant SLIG
and chief executive officer of Defendant SLIG High Interest, exerted managerial
control over both entities.

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FIRST CLAIM FOR RELIEF
Fraud in Connection with the Purchase or Sale of Securities
Violations of Section 10(b) of the Exchange Act and Rule 10b-5 Thereunder
(Against All Defendants)
72. The SEC realleges and incorporates by reference paragraphs 1 through
71 above.
73. In connection with the purchase or sale of securities, Defendants
engaged in a scheme to defraud and made material misrepresentations and omissions
to investors.  Defendants failed to disclose that investor funds were commingled,
transferred to other entities to meet those entities’ cash flow needs, and used to make
Ponzi-like payments to other investors.  Further, Defendants Mehrian and SLIG made
false representations about the profitability about Defendant SLIG’s success, all
while Defendant SLIG was operating at a loss and had negative equity, and falsely
blamed non-payment of guaranteed interest on the COVID-19 pandemic.
Additionally, Defendant Mehrian falsely represented to investors that their
promissory notes would not be automatically renewed without their consent.  Lastly,
Defendants falsely represented that promissory note investments were backed or
collateralized by real estate.
74. Because Defendant Mehrian controlled and had ultimate authority over
his direct communications to investors, postings on Defendant SLIG’s website and
social media, and documents provided to Defendants SLIG and SLIG High Interest’s
promissory note investors, Defendant Mehrian is the maker of these material
misrepresentations and/or omissions.
75. By engaging in the conduct described above, Defendants, and each of
them, directly or indirectly, in connection with the purchase or sale of a security, and
by the use of means or instrumentalities of interstate commerce, of the mails, or of
the facilities of a national securities exchange:  (a) employed devices, schemes, or
artifices to defraud; (b) made untrue statements of a material fact or omitted to state a

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material fact necessary in order to make the statements made, in the light of the
circumstances under which they were made, not misleading; or (c) engaged in acts,
practices, or courses of business which operated or would operate as a fraud or deceit
upon other persons.
76. Because Defendant Mehrian controlled Defendants SLIG and SLIG
High Interest, his knowledge and/or recklessness may be imputed to Defendants
SLIG and SLIG High Interest.
77. Defendants, with scienter, employed devices, schemes, or artifices to
defraud; made untrue statements of material facts or omitted to state material facts
necessary in order to make the statements made, in the light of the circumstances
under which they were made, not misleading; and engaged in acts, practices, or
courses of business which operated or would operate as a fraud or deceit upon other
persons, including purchasers and sellers of securities by the conduct described in
detail above.
78. By engaging in the conduct described above, Defendants each violated,
and unless restrained and enjoined will continue to violate, Section 10(b) of the
Exchange Act, 15 U.S.C. § 78j(b), and Rule 10b-5 thereunder, 17 C.F.R. § 240.10b-5.
SECOND CLAIM FOR RELIEF
Fraud in the Offer or Sale of Securities
Violations of Sections   17(a) of the Securities Act
(Against All Defendants)
79. The SEC realleges and incorporates by reference paragraphs 1 through
71 above.
80. In connection with the purchase or sale of securities, Defendants
engaged in a scheme to defraud and made material misrepresentations or omissions to
investors.  Defendants failed to disclose that investor funds were commingled,
transferred to other entities to meet those entities’ cash flow needs, and used to make
Ponzi-like payments to other investors.  Further, Defendants Mehrian and SLIG made

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false representations about the profitability about SLIG’s success, all while SLIG was
operating at a loss and had negative equity, and falsely blamed non-payment of
guaranteed interest on the COVID-19 pandemic.  Additionally, Defendant Mehrian
falsely represented to investors that their promissory notes would not be
automatically renewed without their consent.  Lastly, Defendants falsely represented
that promissory note investments were backed or collateralized by real estate.
81. By engaging in the conduct described above, Defendants, directly or
indirectly, in the offer or sale of securities by the use of means or instruments of
transportation or communication in interstate commerce or by use of the mails (a)
employed devices, schemes, or artifices to defraud; (b) obtained money or property
by means of untrue statements of a material fact or by omitting 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; or (c) engaged in transactions, practices, or
courses of business which operated or would operate as a fraud or deceit upon the
purchaser.
82. Because Defendant Mehrian controlled Defendants SLIG and SLIG
High Interest, his knowledge, recklessness, and/or negligence may be imputed to
Defendants SLIG and SLIG High Interest.
83. Defendants, with scienter, employed devices, schemes, or artifices to
defraud; and Defendants, with scienter or negligence, obtained money or property by
means of untrue statements of material fact or by omitting 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 engaged in transactions, practices, or
courses of business which operated or would operate as a fraud or deceit upon the
purchaser.
84. Defendants obtained money directly by means of the misrepresentations,
as the promissory note investor money was used to fund Defendants SLIG and SLIG
High Interest’s operations.

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85. By engaging in the conduct described above, Defendants each violated,
and unless restrained and enjoined will continue to violate, Section 17(a) of the
Securities Act, 15 U.S.C. § 77q(a).
THIRD CLAIM FOR RELIEF
Unregistered Offer and Sale of Securities
Violations of Sections 5(a) and 5(c) of the Securities Act
(Against All Defendants)
86. The SEC realleges and incorporates by reference paragraphs 1 through
71 above.
87. Defendants’ offer and sale of SLIG and SLIG High Interest’s securities
were not registered with the SEC and the securities were offered and sold through
interstate commerce.  There was no registration statement in effect or filed with the
SEC with respect to the offering.
88. No exemption applies to Defendants SLIG and SLIG High Interest’s
offer and sale of securities.  Defendants engaged in general solicitation, broadly
targeting members of the public across various states via the internet.  In addition,
Defendants failed to take reasonable steps to verify whether investors actually
qualified as accredited investors, relying instead upon investors’ own representations
as to whether they met the applicable requirements.  Defendants also sold notes to
investors residing outside of California.
89. Defendant Mehrian is liable under Section 5 of the Securities Act for
SLIG and SLIG High Interest’s unregistered offer and sale of securities because
Defendant Mehrian controlled both entities and he was a necessary participant and
substantial factor in the offerings.
90. By engaging in the conduct described above, Defendants, and each of
them, directly or indirectly, singly and in concert with others, made use of the means
or instruments of transportation or communication in interstate commerce, or of the
mails, to offer to sell or to sell securities, or carried or caused to be carried through

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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.
91. By engaging in the conduct described above, Defendants each 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) & 77e(c).
PRAYER FOR RELIEF
WHEREFORE, the SEC respectfully requests that the Court:
I.
Issue findings of fact and conclusions of law that Defendants committed the
alleged violations.
II.
Issue judgments, in forms consistent with Rule 65(d) of the Federal Rules of
Civil Procedure, permanently enjoining Defendants   Mehrian, SLIG, and SLIG High
Interest, and their officers, agents, servants, employees, and attorneys, and those
persons in active concert or participation with any of them, who receive actual notice
of the judgment by personal service or otherwise, and each of them, from violating
Sections 5(a), 5(c), and 17(a) of the Securities Act [15 U.S.C. §§ 77e(a), 77e(c), and
77q(a)], and Section 10(b) of the Exchange Act [15 U.S.C. §§ 78j(b)] and Rule 10b-5
thereunder [17 C.F.R. § 240.10b-5].
III.
Issue judgments, in forms consistent with Rule 65(d) of the Federal Rules of
Civil Procedure, pursuant to Section 21(d)(5) of the Exchange Act [15 U.S.C.
§   78u(d)(5)], permanently enjoining Defendant Mehrian and his officers, agents,
servants, employees and attorneys, and those persons in active concert or
participation with any of them, who receive actual notice of the judgment by personal
service or otherwise, from, directly or indirectly, including, but not limited to,

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through any entity owned or controlled by Defendant Mehrian, participating in the
issuance, purchase, offer, or sale of any security; provided, however, that such
injunction shall not prevent Defendant Mehrian from purchasing or selling securities
for his own personal account.
IV.
Issue judgments, in forms consistent with Rule 65(d) of the Federal Rules of
Civil Procedure, pursuant to Section 21(d)(2) of the Exchange Act [15 U.S.C. §
78u(d)(2)] and/or Section 20(e) of the Securities Act [15 U.S.C. § 77t(e)], prohibiting
Defendant Mehrian 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]
or that is required to file reports pursuant to Section 15(d) of the Exchange Act [15
U.S.C. § 78o(d)].
V.
Order Defendants to disgorge all funds received from their illegal conduct,
together with prejudgment interest thereon, pursuant to Exchange Act Sections
21(d)(3), 21(d)(5) and 21(d)(7) [15 U.S.C. §§ 78u(d)(3), (d)(5) and 78u(d)(7)].
VI.
Order Defendants to pay civil penalties under 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)].
VII.
Retain jurisdiction of this action in accordance with the principles of equity and
the Federal Rules of Civil Procedure in order to implement and carry out the terms of
all orders and decrees that may be entered, or to entertain any suitable application or
motion for additional relief within the jurisdiction of this Court.
VIII.
Grant such other and further relief as this Court may determine to be just and
necessary.

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Dated:  September 27, 2023

/s/ Gary Y. Leung
Gary Y. Leung
Daniel S. Lim
Attorneys   for Plaintiff
Securities and Exchange Commission

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DANIEL S. LIM (Cal. Bar No. 292406) 
Email:  [email protected] 
GARY Y. LEUNG (Cal. Bar No. 302928) 
Email:  [email protected] 
 
Attorneys for Plaintiff 
Securities and Exchange Commission 
Katharine E. Zoladz, Co-Acting Regional Director  
Gary Y. Leung, Associate Regional Director 
444 S. Flower Street, Suite 900 
Los Angeles, California 90071 
Telephone: (323) 965-3998 
Facsimile: (213) 443-1904 

UNITED STATES DISTRICT COURT 

CENTRAL DISTRICT OF CALIFORNIA 

 

SECURITIES AND EXCHANGE 
COMMISSION, 

Plaintiff, 
 

vs. 

PEDRAM ABRAHAM MEHRIAN, 
STRATEGIC LEGACY 
INVESTMENT GROUP, INC., and 
SLIG HIGH INTEREST LIQUID 
SAVINGS COMPANY, 

Defendants. 
 

 Case No. 2:23-cv-08009 
 
AMENDED COMPLAINT 
 

Plaintiff Securities and Exchange Commission (“SEC”) alleges: 

JURISDICTION AND VENUE 

1. The Court has jurisdiction over this action pursuant to Sections 20(b), 

20(d)(1) and 22(a) of the Securities Act of 1933 (“Securities Act”), 15 U.S.C. §§ 

77t(b), 77t(d)(1) & 77v(a), and Sections 21(d)(1), 21(d)(3)(A), 21(e) and 27(a) of the 

Securities Exchange Act of 1934 (“Exchange Act”), 15 U.S.C. §§ 78u(d)(1), 

78u(d)(3)(A), 78u(e) & 78aa(a). 

2. Defendants have, directly or indirectly, made use of the means or 

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instrumentalities of interstate commerce, of the mails, or of the facilities of a national 

securities exchange in connection with the transactions, acts, practices and courses of 

business alleged in this complaint.  

3. Venue is proper in this district pursuant to Section 22(a) of the Securities 

Act, 15 U.S.C. § 77v(a), and Section 27(a) of the Exchange Act, 15 U.S.C. § 78aa(a) 

because certain of the transactions, acts, practices, and courses of conduct 

constituting violations of the federal securities laws occurred within this district.  In 

addition, venue is proper in this district because Defendant Pedram Abraham Mehrian 

(“Mehrian”) resides in this district, and Defendants Strategic Legacy Investment 

Group, Inc. (“SLIG”) and SLIG High Interest Liquid Savings Company (“SLIG High 

Interest”) (collectively, “Defendants”) have their principal places of business here. 

SUMMARY 

4. This civil enforcement action concerns a $17.5 million offering fraud 

perpetrated by Defendant Mehrian and his real estate investment companies 

Defendants SLIG and SLIG High Interest.   

5. From January 2018 through October 2022, Defendants raised at least 

$17.5 million from over 150 investors through the unregistered sale of promissory 

notes; Defendants told investors that their funds would be used to finance real estate 

developments.  Significantly, Defendants took in this eight-figure sum from note 

investors through claims about the safety and security of their investment:  that their 

promissory notes were “safe” and “secure” because they were “backed by SLIG’s 

portfolio of assets”; that the notes were “collateralized” by Defendants’ real estate 

portfolio; that the notes would pay “guaranteed interest” above prevailing market 

rates offered by banks; and that investments in Defendants’ promissory notes were 

“recession-proof.”  These representations, all significant to an objectively reasonable 

investor’s decision to invest, were false and misleading. 

6. In truth, Defendants improperly treated investor proceeds as one pool of 

money, commingled investor funds, regularly moved money among operating 

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accounts to meet SLIG’s cash flow needs of the moment, and diverted incoming 

investor funds to make Ponzi-like payments to existing investors totaling 

approximately $4.2 million.  Last, Defendants failed to inform investors that over the 

entire period of the promissory note offering, their real estate development business 

had consistently operated at a loss and was incapable of generating enough revenue 

from real estate operations to pay promissory note investors their promised returns.     

7. By engaging in this conduct, Defendants Mehrian, SLIG, and SLIG High 

Interest violated the antifraud provisions of Section 17(a) of the Securities Act, 15 

U.S.C. § 77q(a), and Section 10(b) of the Exchange Act, 15 U.S.C. § 78j(b), and Rule 

10b-5 thereunder, 17 C.F.R. § 240.10b-5, and violated the registration provisions of 

Sections 5(a) and 5(c) of the Securities Act, 15 U.S.C. § 77e(a) and (c). 

8. With this complaint, the SEC seeks permanent injunctions prohibiting 

Defendants’ future violations of the federal securities laws, disgorgement of 

Defendants’ ill-gotten gains together with prejudgment interest, civil penalties from 

Defendants, a conduct-based injunction permanently enjoining Defendant Mehrian 

from participating in the issuance, purchase, offer, or sale of any security (provided, 

however, that such injunction shall not prevent him from purchasing or selling 

securities for his own personal account), and an officer and director bar as to 

Defendant Mehrian.   

THE DEFENDANTS 

13. Pedram Abraham Mehrian (“Mehrian”), age 42, is a resident of Los 

Angeles, California.  He was the co-founder, president, chief executive officer, 

chairman, director, and majority owner of Defendant SLIG, and was the chief 

executive officer and a director of Defendant SLIG High Interest.  Defendant 

Mehrian exerted managerial control over both entities and related SLIG 

entities/subsidiaries.  Defendant Mehrian was associated with a broker-dealer 

registered with the Commission from 2002 to 2011.   

14. Strategic Legacy Investment Group, Inc. (“SLIG”), is a California 

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corporation that was incorporated in 2014, with its principal place of business in Los 

Angeles, California.  Defendant SLIG marketed itself as a “private placement 

investment firm” focused on real estate development, or as a “private equity” real 

estate investment and development firm that offered and sold promissory notes.  

Neither Defendant SLIG nor its securities offerings has ever been registered with the 

SEC in any capacity.   

15. SLIG High Interest Liquid Savings Company (“SLIG High 

Interest”), is a California corporation that was incorporated in 2019, with its 

principal place of business in Los Angeles, California.  Defendant SLIG High 

Interest, a subsidiary of SLIG, existed to offer and sell promissory notes.  Neither 

Defendant SLIG High Interest nor its securities offerings has ever been registered 

with the SEC in any capacity. 

THE ALLEGATIONS 

A. Defendants’ Securities Offering 

16. From at least January 2018 through October 2022, Defendants SLIG and 

SLIG High Interest offered and sold approximately $17.5 million in promissory notes 

to over 150 investors across the United States.  Many of Defendants’ promissory note 

investors purchased those investments through self-directed IRAs.   

17. Defendant SLIG had begun selling promissory notes since 2015, and 

Defendant SLIG High Interest had begun selling promissory notes since 2020. 

18. The promissory notes offered by both entities were part of one 

continuous offering, and Defendant SLIG High Interest’s notes represented that 

Defendant SLIG was the guarantor.   

19. Defendant Mehrian signed both entities’ promissory notes on behalf of 

Defendant SLIG as its president.  For Defendant SLIG’s own promissory notes, 

Defendant SLIG was the borrower, and for Defendant SLIG High Interest’s 

promissory notes it was the borrower and Defendant SLIG was the guarantor.   

20. Defendant Mehrian exercised full decision-making authority over 

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Defendants SLIG and SLIG High Interest’s operations.   

21. Further, Defendant Mehrian authorized the promissory notes’ use for 

offer, purchase, and sale.     

22. Additionally, Defendant Mehrian was a signatory on Defendants SLIG 

and SLIG High Interest’s bank accounts, and thus controlled how the investor funds 

deposited into those accounts were used.   

23. Both Defendants SLIG and SLIG High Interest’s promissory notes 

offered anywhere between at least 4% and 7.26%, and as high as 9%, in annual 

interest, to be paid monthly, quarterly, semi-annually, or accrued, and guaranteed a 

return of principal upon maturity, which was typically 12 months. 

B. Marketing and General Solicitation of SLIG and SLIG High Interest 

Offering  

24. Defendants Mehrian, SLIG, and SLIG High Interest engaged in general 

solicitation for SLIG and SLIG High Interest’s promissory note offering, marketing 

the notes primarily via the internet and emails, and through oral representations to 

investors.     

25. For example, Defendants made the following representations through 

SLIG’s website:   

a. Defendant SLIG was “a private equity firm that creates timeless, 

trusted real estate projects,” selecting “secure investment projects that will prosper 

and grow throughout all economic cycles over time.” 

b. Defendant SLIG High Interest was Defendant SLIG’s subsidiary 

and “a savings vehicle designed to provide higher returns through its unique 

promissory note program,” which helped “ensure the proper administration of all of 

SLIG’s assets.”  

c. Defendant SLIG’s “High Interest Liquid Savings” investment 

option involved issuing promissory notes that were “backed by California lending 

laws,” and were “backed by SLIG’s portfolio of assets.”  

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d. The High Interest Liquid Savings promissory notes were “safe and 

recession-proof,” guaranteed a monthly income, “earn[ed] higher interest,” and 

“outpace[d] inflation.”    

e. The promissory notes would be issued by Defendant SLIG High 

Interest, whose accounts were “collateralized by the real estate portfolio” owned by 

Defendant SLIG High Interest.  

f. The “$295 million worth of real estate” purportedly consisted of 

properties that were described as “income producing asset[s]” and/or generated 

“rate[s] of return” from 39.07% to 118.45%.  

26. Additionally, Defendant SLIG made the following representations 

through emails to prospective and new investors:   

a. Defendant SLIG offered “unique investment opportunities in 

diverse, flourishing real estate markets across the country,” created a “well-

diversified portfolio that ha[d] out-performed traditional investment options, resulting 

in secure and profitable returns,” and had a “current projected portfolio” consisting of 

“about $342M of real estate assets in office, multi-family, and senior living spaces.”  

b. Defendant SLIG was offering a “SLIG savings account” as an 

alternative to a “traditional savings account,” with interest rates ranging from 6.01% 

to 8.02% depending how much money was deposited.   

27. Furthermore, Defendant SLIG posted a YouTube video titled “SLIG 

High Return Liquid Savings” that made the following representations, through 

Defendant SLIG’s representatives: 

a. Defendant SLIG’s promissory note program provided a “secure 

and lucrative” investment alternative to the volatile stock market and traditional 

savings accounts, which were “not exciting or worthwhile to savvy investors.”  

b. All of Defendant SLIG’s promissory notes were “backed by 

California lending laws and by SLIG’s portfolio of assets.”  

c. Investors would receive monthly interest payments. 

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d. Defendant SLIG offered “the highest interest rate,” and was “safe, 

secure.”  

e. Investor money would remain liquid and not be “locked.”  

28. Moreover, Defendant Mehrian made the following oral representations 

directly to investors: 

a. Defendant SLIG’s promissory notes provided greater investor 

returns than traditional investments. 

b. Defendant SLIG’s promissory notes were secured loans, backed 

by Defendant SLIG’s real estate holdings and rental revenue.   

c. Defendant SLIG’s promissory note investments remained in its 

corporate accounts, and were never loaned out for other purposes.  

d. Investors would get a check in the mail the first of every month. 

e. Defendant SLIG would not automatically renew promissory notes 

without first talking to the investor. 

f. Real estate investments were better than stock market investments 

because the former were more secure, less volatile, and more profitable. 

29. Defendants did not attempt to verify the accredited status of promissory 

note investors.     

C. Violations of the Antifraud Provisions 

1. False and Misleading Statements Concerning Use of Investor 

Funds   

30. Defendants Mehrian, SLIG, and SLIG High Interest made false and 

misleading statements to promissory note investors about the safety and security of 

the promissory note investment.  Specifically, Defendants failed to disclose that 

investor funds were commingled, transferred to other SLIG-related entities to meet 

those entities’ cash flow needs, and used to make Ponzi-like payments to other 

promissory note investors.   

31. Defendant Mehrian had control over all promissory note investor money, 

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and he caused SLIG to treat it as one pool of funds, moving money between various 

SLIG-related entities to meet cash flow needs for SLIG’s planned multi-family and 

senior living and commercial real estate projects.   

32. Defendant Mehrian caused SLIG to document these transfers as loans to, 

or investments in, the SLIG project entities, if they were documented at all.    

33. Such transfers of promissory note investor money allowed SLIG-related 

entities low on cash to continue in operation and allowed the Defendants to portray 

SLIG and its network of associated, affiliated, and related entities as a successful real 

estate enterprise with significant liquidity, which, as explained below, was a false and 

misleading portrayal.    

34. From at least January 2018 to October 2022, while the promissory note 

offering was still ongoing and SLIG was operating at a net loss, Defendants Mehrian, 

SLIG, and SLIG High Interest made at least $4.2 million (out of the $17.5 million 

raised) in Ponzi-like payments—that is, payments to prior promissory note investors 

from new investor funds.  For example: 

a. In May 2019, $140,800 in Ponzi-like payments were made to 

investors, when SLIG’s monthly income was just $11,396.   

b. In November 2020, $120,890 in Ponzi-like payments were made 

to investors, when SLIG’s monthly income was just $1,427.   

c. In January 2022, $20,214 in Ponzi-like payments were made to 

investors, when SLIG’s monthly income was just $354.   

2. False and Misleading Statements Concerning Profitability and 

Ability to Pay Investors 

35. Defendants Mehrian and SLIG made false and misleading statements 

about Defendant SLIG’s profitability and success, as mentioned above, and never 

disclosed that Defendant SLIG was consistently operating at a loss and had negative 

equity throughout the relevant period.   

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36. Between fiscal years 2016 and 2020, Defendant SLIG’s total liabilities 

exceeded $18.3 million, including $13.4 million owed to promissory note investors 

and over $4 million payable to other SLIG entities.   

37. During this same period, Defendant SLIG’s negative equity was in 

excess of $6.3 million.  

38. Notably, in March 2020, as investors asked Defendants about not having 

received interest payment and for return of principal, Defendants cited the COVID-19 

pandemic as an excuse for why they could not pay investors.   

39. Specifically, Defendant SLIG sent promissory note investors an 

unsigned letter announcing the suspension of interest payments, stating, “This is due 

to sources of funds from different financial lenders being delayed resulting from the 

continuing uncertainty around COVID-19.”   

40. After further inquiries and complaints from investors, Defendants sent 

investors a written “Statement of Condition” for SLIG—that Defendant Mehrian co-

signed—representing that SLIG and its subsidiaries “are a well-capitalized and strong 

financial investment institution.”   

41. In that correspondence, Defendant SLIG represented that: “[b]ased on 

our current portfolio and strategic location of assets, we have put ourselves in a 

strong and safe position to weather the storm in any economic downturn;” “[w]e have 

created a safe haven for our investors to invest and preserve capital, backed by our 

real estate portfolio;” and “[i]n comparison to other money market accounts with 

negative returns, CDs, and other investment vehicles, our Promissory Notes remain 

the most lucrative option in the current economic environment.”   

42. Following this correspondence, Defendant SLIG sent promissory note 

investors monthly statements that set forth the investor’s total principal amount, 

interest rate, monthly interest, and, in some cases, a “current value” figure, even 

though they did not receive the guaranteed monthly interest payments.   

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43. Defendants Mehrian, SLIG, and SLIG High Interest thus engaged in 

lulling by continuing to represent to investors that they would still be paid guaranteed 

interest payments in the future, and that their principal would eventually be returned, 

even after Defendants ceased paying investors’ purportedly guaranteed monthly 

interest payments.  

44. By year-end 2020, Defendant SLIG lacked sufficient assets to satisfy its 

payment obligations to promissory note investors and amounts owed to Defendant 

SLIG’s other entities.     

45. Further, from 2018 to 2022, Defendant SLIG did not generate sufficient 

revenue from its real estate holdings to pay investors their promised returns.  

46. During this same period, Defendant SLIG’s operation was funded 

entirely from the proceeds derived from the sale of promissory notes. 

3. False and Misleading Statements Concerning Automatic 

Renewal of Promissory Notes 

47. In 2020, despite Defendant Mehrian’s prior representations of 

“guaranteed interest” on the notes, and the notes providing no authority for 

Defendants to unilaterally defer those interest payments to a later date, Defendant 

SLIG unilaterally renewed investors’ promissory notes without advance notice and 

without consent of the investors.   

48. Defendant SLIG extended the maturity date of the notes by, in some 

cases, over a year, depriving investors of the option to forego renewal and to obtain 

the return of their principal and accrued, unpaid interest, upon maturity of their 

promissory notes.   

4. False and Misleading Statements Concerning Investor’s 

Purported Collateralized Interest in SLIG’s Real Estate 

Portfolio  

49. Despite Defendants Mehrian, SLIG, and SLIG High Interest’s 

representations that promissory note investments were backed or collateralized by 

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Defendants SLIG and SLIG High Interest’s real estate portfolio, the reality was that 

the promissory note investments were unsecured and uncollateralized, with no 

enforceable interest in real estate.  This was contrary to Defendants’ false and 

misleading statements that their investments were more stable than the stock market, 

safe, secure, and recession-proof because the promissory notes were backed by real 

estate assets and collateralized.     

D. Defendants’ False and Misleading Statements Were Material 

50. Each of Defendants Mehrian, SLIG, and SLIG High Interest’s false and 

misleading statements and omissions were material.   

51. A reasonable investor would have considered it important to know that 

their money was being used to make Ponzi-like payments to other investors.   

52. A reasonable investor also would have considered it important to know 

that they were investing their money into a purported real estate development 

company—and its related entities—that was consistently operating at a loss with 

negative equity from its real estate operations.   

53. A reasonable investor further would have considered it important to 

know that their notes could be renewed unilaterally without their knowledge or 

approval.   

54. Finally, a reasonable investor would have considered it important to 

know that their funds were not backed or collateralized by any real estate holdings. 

55. All of the foregoing facts—misuse of investor funds to make Ponzi-like 

payments, consistent operating losses from the real estate projects, deferred interest 

payments at Defendants’ unilateral discretion, and note holders having no enforceable 

collateral interest in real estate assets—contradicted Defendants’ representations that 

their promissory note investments were “safe” and “secure” because they were 

“backed by SLIG’s portfolio of assets,” “collateralized” by Defendants’ real estate 

portfolio, would pay “guaranteed interest” above prevailing market rates offered by 

banks, and were consequently “recession-proof” investments.      

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E. Defendants Acted with Scienter and Their Conduct Was Negligent 

56. Defendant Mehrian knew, or was reckless in not knowing, that his, and 

Defendants SLIG and SLIG High Interest’s, misrepresentations that their promissory 

note investments were “safe” and “secure” because they were “backed by SLIG’s 

portfolio of assets,” “collateralized” by Defendants’ real estate portfolio, would pay 

“guaranteed interest” above prevailing market rates offered by banks, and were 

consequently “recession-proof” investments were false and misleading.  For the same 

reasons, Defendant Mehrian’s conduct was unreasonable and therefore negligent.   

57. Defendant Mehrian’s scienter is attributable to Defendants SLIG and 

SLIG High Interest because he, as the president of Defendant SLIG and chief 

executive officer of Defendant SLIG High Interest, exerted managerial control over 

both entities.   

58. Defendant Mehiran’s negligence is attributable to Defendants SLIG and 

SLIG High Interest because he, as the President of Defendant SLIG and C.E.O. of 

Defendant SLIG High Interest, exerted managerial control over both entities. 

F. Defendants Obtained Money By Means of the Misrepresentations 

59. Defendants obtained money directly by means of the misrepresentations, 

as the promissory note investor money was used to fund SLIG and SLIG High 

Interest’s purported real estate operations.   

G. The Promissory Notes Offered and Sold by Defendants Are 

Securities  

60. Based on Defendants’ materially false and misleading statements, 

investors invested money into accounts controlled by Defendants in order to receive 

returns in the form of fixed interest payments. 

61. Defendant Mehrian pooled the investor funds—which investors were 

told were collateralized by Defendants SLIG and SLIG High Interest’s real estate 

portfolios and investments—into various bank accounts.   

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62. The managerial efforts of Defendants SLIG and SLIG High Interest, 

with respect to their purported real estate assets and portfolio, were to be led entirely 

by Defendants.   

63. Promissory note investors were entirely passive, and they reasonably 

expected profits based on Defendants’ managerial efforts due to the false and 

misleading representations made to them.   

G. Registration Violations: Sections 5(a) and 5(c) of the Securities Act 

64. Defendants Mehrian, SLIG, and SLIG High Interest offered and sold 

securities, raising over $17.5 million from about 150 investors throughout the United 

States from at least January 2018 to October 2022.   

65. The SLIG and SLIG High Interest offering was never registered with the 

SEC. 

66. The SLIG and SLIG High Interest securities were offered and sold 

through interstate commerce. 

67. The SLIG and SLIG High Interest offering was not exempt from 

registration. 

68. Defendant Mehrian, and Defendants SLIG and SLIG High Interest, as 

the issuers of the securities, directly offered and sold securities through general 

solicitation, broadly targeting members of the public via the internet. 

69. Defendants Mehrian, SLIG, and SLIG High Interest offered and sold 

securities to investors residing outside of California.   

70. Defendants Mehrian, SLIG, and SLIG High Interest did not take 

reasonable steps to verify whether investors residing in the United States were 

accredited. 

71. Defendant Mehrian is liable for Defendants SLIG and SLIG High 

Interest’s offer and sale of securities because he, as the president of Defendant SLIG 

and chief executive officer of Defendant SLIG High Interest, exerted managerial 

control over both entities.   

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FIRST CLAIM FOR RELIEF 

Fraud in Connection with the Purchase or Sale of Securities 

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

(Against All Defendants) 

72. The SEC realleges and incorporates by reference paragraphs 1 through 

71 above. 

73. In connection with the purchase or sale of securities, Defendants 

engaged in a scheme to defraud and made material misrepresentations and omissions 

to investors.  Defendants failed to disclose that investor funds were commingled, 

transferred to other entities to meet those entities’ cash flow needs, and used to make 

Ponzi-like payments to other investors.  Further, Defendants Mehrian and SLIG made 

false representations about the profitability about Defendant SLIG’s success, all 

while Defendant SLIG was operating at a loss and had negative equity, and falsely 

blamed non-payment of guaranteed interest on the COVID-19 pandemic.  

Additionally, Defendant Mehrian falsely represented to investors that their 

promissory notes would not be automatically renewed without their consent.  Lastly, 

Defendants falsely represented that promissory note investments were backed or 

collateralized by real estate.    

74. Because Defendant Mehrian controlled and had ultimate authority over  

his direct communications to investors, postings on Defendant SLIG’s website and 

social media, and documents provided to Defendants SLIG and SLIG High Interest’s 

promissory note investors, Defendant Mehrian is the maker of these material 

misrepresentations and/or omissions. 

75. By engaging in the conduct described above, Defendants, and each of 

them, directly or indirectly, in connection with the purchase or sale of a security, and 

by the use of means or instrumentalities of interstate commerce, of the mails, or of 

the facilities of a national securities exchange:  (a) employed devices, schemes, or 

artifices to defraud; (b) made untrue statements of a material fact or omitted to state a 

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material fact necessary in order to make the statements made, in the light of the 

circumstances under which they were made, not misleading; or (c) engaged in acts, 

practices, or courses of business which operated or would operate as a fraud or deceit 

upon other persons. 

76. Because Defendant Mehrian controlled Defendants SLIG and SLIG 

High Interest, his knowledge and/or recklessness may be imputed to Defendants 

SLIG and SLIG High Interest.   

77. Defendants, with scienter, employed devices, schemes, or artifices to 

defraud; made untrue statements of material facts or omitted to state material facts 

necessary in order to make the statements made, in the light of the circumstances 

under which they were made, not misleading; and engaged in acts, practices, or 

courses of business which operated or would operate as a fraud or deceit upon other 

persons, including purchasers and sellers of securities by the conduct described in 

detail above. 

78. By engaging in the conduct described above, Defendants each violated, 

and unless restrained and enjoined will continue to violate, Section 10(b) of the 

Exchange Act, 15 U.S.C. § 78j(b), and Rule 10b-5 thereunder, 17 C.F.R. § 240.10b-5. 

SECOND CLAIM FOR RELIEF 

Fraud in the Offer or Sale of Securities 

Violations of Sections 17(a) of the Securities Act 

(Against All Defendants) 

79. The SEC realleges and incorporates by reference paragraphs 1 through 

71 above. 

80. In connection with the purchase or sale of securities, Defendants 

engaged in a scheme to defraud and made material misrepresentations or omissions to 

investors.  Defendants failed to disclose that investor funds were commingled, 

transferred to other entities to meet those entities’ cash flow needs, and used to make 

Ponzi-like payments to other investors.  Further, Defendants Mehrian and SLIG made 

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false representations about the profitability about SLIG’s success, all while SLIG was 

operating at a loss and had negative equity, and falsely blamed non-payment of 

guaranteed interest on the COVID-19 pandemic.  Additionally, Defendant Mehrian 

falsely represented to investors that their promissory notes would not be 

automatically renewed without their consent.  Lastly, Defendants falsely represented 

that promissory note investments were backed or collateralized by real estate.    

81. By engaging in the conduct described above, Defendants, directly or 

indirectly, in the offer or sale of securities by the use of means or instruments of 

transportation or communication in interstate commerce or by use of the mails (a) 

employed devices, schemes, or artifices to defraud; (b) obtained money or property 

by means of untrue statements of a material fact or by omitting 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; or (c) engaged in transactions, practices, or 

courses of business which operated or would operate as a fraud or deceit upon the 

purchaser. 

82. Because Defendant Mehrian controlled Defendants SLIG and SLIG 

High Interest, his knowledge, recklessness, and/or negligence may be imputed to 

Defendants SLIG and SLIG High Interest.   

83. Defendants, with scienter, employed devices, schemes, or artifices to 

defraud; and Defendants, with scienter or negligence, obtained money or property by 

means of untrue statements of material fact or by omitting 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 engaged in transactions, practices, or 

courses of business which operated or would operate as a fraud or deceit upon the 

purchaser. 

84. Defendants obtained money directly by means of the misrepresentations, 

as the promissory note investor money was used to fund Defendants SLIG and SLIG 

High Interest’s operations.   

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85. By engaging in the conduct described above, Defendants each violated, 

and unless restrained and enjoined will continue to violate, Section 17(a) of the 

Securities Act, 15 U.S.C. § 77q(a). 

THIRD CLAIM FOR RELIEF 

Unregistered Offer and Sale of Securities 

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

(Against All Defendants) 

86. The SEC realleges and incorporates by reference paragraphs 1 through 

71 above. 

87. Defendants’ offer and sale of SLIG and SLIG High Interest’s securities 

were not registered with the SEC and the securities were offered and sold through 

interstate commerce.  There was no registration statement in effect or filed with the 

SEC with respect to the offering. 

88. No exemption applies to Defendants SLIG and SLIG High Interest’s 

offer and sale of securities.  Defendants engaged in general solicitation, broadly 

targeting members of the public across various states via the internet.  In addition, 

Defendants failed to take reasonable steps to verify whether investors actually 

qualified as accredited investors, relying instead upon investors’ own representations 

as to whether they met the applicable requirements.  Defendants also sold notes to 

investors residing outside of California.   

89. Defendant Mehrian is liable under Section 5 of the Securities Act for 

SLIG and SLIG High Interest’s unregistered offer and sale of securities because 

Defendant Mehrian controlled both entities and he was a necessary participant and 

substantial factor in the offerings.   

90. By engaging in the conduct described above, Defendants, and each of 

them, directly or indirectly, singly and in concert with others, made use of the means 

or instruments of transportation or communication in interstate commerce, or of the 

mails, to offer to sell or to sell securities, or carried or caused to be carried through 

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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. 

91. By engaging in the conduct described above, Defendants each 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) & 77e(c). 

PRAYER FOR RELIEF 

WHEREFORE, the SEC respectfully requests that the Court: 

I. 

Issue findings of fact and conclusions of law that Defendants committed the 

alleged violations. 

II. 

Issue judgments, in forms consistent with Rule 65(d) of the Federal Rules of 

Civil Procedure, permanently enjoining Defendants Mehrian, SLIG, and SLIG High 

Interest, and their officers, agents, servants, employees, and attorneys, and those 

persons in active concert or participation with any of them, who receive actual notice 

of the judgment by personal service or otherwise, and each of them, from violating 

Sections 5(a), 5(c), and 17(a) of the Securities Act [15 U.S.C. §§ 77e(a), 77e(c), and 

77q(a)], and Section 10(b) of the Exchange Act [15 U.S.C. §§ 78j(b)] and Rule 10b-5 

thereunder [17 C.F.R. § 240.10b-5]. 

III. 

Issue judgments, in forms consistent with Rule 65(d) of the Federal Rules of 

Civil Procedure, pursuant to Section 21(d)(5) of the Exchange Act [15 U.S.C. 

§ 78u(d)(5)], permanently enjoining Defendant Mehrian and his officers, agents, 

servants, employees and attorneys, and those persons in active concert or 

participation with any of them, who receive actual notice of the judgment by personal 

service or otherwise, from, directly or indirectly, including, but not limited to, 

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through any entity owned or controlled by Defendant Mehrian, participating in the 

issuance, purchase, offer, or sale of any security; provided, however, that such 

injunction shall not prevent Defendant Mehrian from purchasing or selling securities 

for his own personal account. 

IV. 

Issue judgments, in forms consistent with Rule 65(d) of the Federal Rules of 

Civil Procedure, pursuant to Section 21(d)(2) of the Exchange Act [15 U.S.C. § 

78u(d)(2)] and/or Section 20(e) of the Securities Act [15 U.S.C. § 77t(e)], prohibiting 

Defendant Mehrian 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] 

or that is required to file reports pursuant to Section 15(d) of the Exchange Act [15 

U.S.C. § 78o(d)]. 

V. 

Order Defendants to disgorge all funds received from their illegal conduct, 

together with prejudgment interest thereon, pursuant to Exchange Act Sections 

21(d)(3), 21(d)(5) and 21(d)(7) [15 U.S.C. §§ 78u(d)(3), (d)(5) and 78u(d)(7)]. 

VI. 

Order Defendants to pay civil penalties under 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)]. 

VII. 

Retain jurisdiction of this action in accordance with the principles of equity and 

the Federal Rules of Civil Procedure in order to implement and carry out the terms of 

all orders and decrees that may be entered, or to entertain any suitable application or 

motion for additional relief within the jurisdiction of this Court. 

VIII. 

Grant such other and further relief as this Court may determine to be just and 

necessary. 

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Dated:  September 27, 2023  
 
/s/ Gary Y. Leung 
Gary Y. Leung 
Daniel S. Lim 
Attorneys for Plaintiff 
Securities and Exchange Commission 

 

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	A. Defendants’ Securities Offering
	B. Marketing and General Solicitation of SLIG and SLIG High Interest Offering
	C. Violations of the Antifraud Provisions
	1. False and Misleading Statements Concerning Use of Investor Funds
	2. False and Misleading Statements Concerning Profitability and Ability to Pay Investors
	3. False and Misleading Statements Concerning Automatic Renewal of Promissory Notes
	4. False and Misleading Statements Concerning Investor’s Purported Collateralized Interest in SLIG’s Real Estate Portfolio

	D. Defendants’ False and Misleading Statements Were Material
	E. Defendants Acted with Scienter and Their Conduct Was Negligent
	F. Defendants Obtained Money By Means of the Misrepresentations
	G. The Promissory Notes Offered and Sold by Defendants Are Securities