SEC v. EMPIRES CONSULTING CORP. (DBA “EMPIRESX”); EMERSON SOUSA PIRES; FLAVIO MENDES GONCALVES; and JOSHUA DAVID NICHOLAS, No. 1:22-cv-21995, Southern District of Florida (May 12, 2023) — Complaint

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF FLORIDA

UNITED STATES SECURITIES AND
EXCHANGE COMMISSION,

Plaintiff,

              v.

Case No. 1:22cv21995
EMPIRES CONSULTING CORP. (DBA
“EMPIRESX”), EMERSON SOUSA PIRES,
FLAVIO MENDES GONCALVES,
and JOSHUA DAVID NICHOLAS,

Defendants.

______________________________________/

COMPLAINT
  Plaintiff, United States Securities and Exchange Commission (“SEC”), alleges:
1. This case stems from an illegal offering fraud scheme perpetrated by
Defendants Emerson Sousa Pires and Flavio Mendes Goncalves, their company, Defendant
Empires Consulting Corp. (“EmpiresX”), and EmpiresX’s head trader, Defendant Joshua
David Nicholas (collectively, “Defendants”).  In less than two years, Defendants raised at
least $40 million by selling EmpiresX investments to thousands of investors.
2. Defendants lured investors with claims of “exponential” profits, expected
investment returns of 1% per day, and the prospect of making millions of dollars “in a
matter of months.”  Defendants told investors that EmpiresX would generate these outsized
returns either through a proprietary trading “bot” or by manual trading performed by
Defendant Nicholas.  But these statements were lies.  In reality, the bot was fake,
Defendants traded only a fraction of the funds they took from investors, and that limited
trading failed to earn anywhere near the expected returns Defendants touted to investors.

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3. Instead, Defendants misappropriated large sums of investors’ money for
personal uses such as luxury cars, real estate, and travel.
4. Beyond their untrue claims of 1% daily profits earned by bot or manual
trading, Defendants further lied to investors to give them assurances of the “transparency
and safety” of their investments, even during market downturns.  To that end, Defendants
falsely told investors that EmpiresX had filed paperwork with the SEC to register as a
hedge fund, and directed investors to the filings of an unaffiliated hedge fund with a name
similar to EmpiresX that actually had registered with the SEC.  Similarly, Defendants
touted Nicholas as a licensed trader and deceptively showed investors the credentials of a
different trader with a similar name to Nicholas, while concealing that Nicholas had been
suspended from trading for misappropriating customer funds.
5. As their scheme began to collapse, Defendants broke earlier promises that
investors could easily withdraw their money and later assurances of repayment.  Instead,
Defendants refused to honor investor requests to withdraw their funds and gave phony
excuses why the investors could not be repaid.
6. After learning of the SEC’s investigation, Defendants Pires and Goncalves
began winding down EmpiresX’s United States operations and, in an effort to escape
liability, relocated to Brazil.  They left investors with heavy losses.
7. In addition to being fraudulent, Defendants’ offers and sales of EmpiresX
securities violated the registration provisions of the federal securities laws.
8. The SEC brings this lawsuit to hold Defendants responsible for their fraud,
prevent them from harming future investors, and return money to Defendants’ victims.

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JURISDICTION AND VENUE
9. The SEC brings this action pursuant to Section 20(b) of the Securities Act
of 1933 (“Securities Act”) [15 U.S.C. § 77t(b)] and Sections 21(d) and 21(e) of the
Securities Exchange Act of 1934 (“Exchange Act”) [15 U.S.C. §§ 78u(d) and 78u(e)].
10. This Court has jurisdiction over this action pursuant to Section 22 of the
Securities Act [15 U.S.C. § 77v], Section 27 of the Exchange Act [15 U.S.C. § 78aa], and
28 U.S.C. § 1331.
11. Venue is proper in this Court pursuant to Section 27 of the Exchange Act
[15 U.S.C. § 78aa].  Acts, practices and courses of business constituting violations alleged
herein have occurred within the jurisdiction of the United States District Court for the
Southern District of Florida and elsewhere.
12. Defendants directly and indirectly made use of the means and
instrumentalities of interstate commerce and of the mails in connection with the acts,
practices, and courses of business alleged herein, and will continue to do so unless
enjoined.
DEFENDANTS
13. Defendant Empires Consulting Corp. (dba “EmpiresX”) is a Florida
corporation with its principal place of business formerly in Fort Myers, Florida.
Defendants Pires and Goncalves founded EmpiresX in 2020.  EmpiresX is not registered
with the SEC in any capacity, nor has it ever registered any offering of securities under the
Securities Act or any class of securities under the Exchange Act.

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14. Defendant Emerson Sousa Pires (“Pires”), age 33, formerly of Fort
Myers, Florida, is EmpiresX’s co-founder, president, director, and registered agent.  Pires
now resides in Brazil, where he is a citizen.  When Pires registered EmpiresX as a
corporation with the State of Florida, he listed his home address in Fort Myers – an address
at which Pires no longer resides after relocating to Brazil – as EmpiresX’s principal,
registered agent, and mailing address.
15. Defendant Flavio Mendes Goncalves (“Goncalves”), age 34, formerly of
Port St. Lucie, Florida, is EmpiresX’s co-founder, vice president, and director.  Goncalves
now resides in Brazil, where he is a citizen.
16. Defendant Joshua David Nicholas (“Nicholas”), age 28, of Stuart, Florida,
was EmpiresX’s head trader.  For brief periods in 2016 and 2020, Nicholas was a
registered representative and investment adviser representative associated with broker-
dealers and investment advisers.  In September 2020, the National Futures Association
(“NFA”) suspended Nicholas from membership and prohibited him from association with
any NFA member, after Nicholas misappropriated client funds in order to fund a personal
trading account.  In April 2021, the NFA extended Nicholas’s suspension for an additional
eight years.  In January 2022, the Financial Industry Regulatory Authority (“FINRA”)
barred Nicholas from associating with registered broker-dealers, as a result of that same
conduct.

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FACTS
Overview of EmpiresX
17. In late 2020, Pires and Goncalves founded EmpiresX and based the
company in South Florida.  Pires and Goncalves controlled EmpiresX, including its
operations, the content of representations made to investors, and how EmpiresX used funds
received from investors.
18.  Since its formation, EmpiresX raised at least $40 million from thousands of
investors worldwide, including many investors in the United States, by offering and selling
investments that Defendants claimed earned 1% daily returns.
19. None of the securities or securities offerings described herein were
registered with the SEC.
20. Defendants represented to investors that EmpiresX was a hedge fund that
planned to manage over $100 million in investor funds and had filed with the SEC to
become a U.S. registered hedge fund.
21. Defendants lured investors by offering and selling two different investment
options that would each purportedly generate the 1% daily returns.
22. The first investment option Defendants presented to investors were licenses
to use EmpiresX’s trading bot, which Defendants called the “Exbot.”
23. The second investment option Defendants presented to investors were
“private” investments that involved the pooling of investor funds in EmpiresX’s brokerage
accounts, which Nicholas would use to manually trade stock, options, and futures.

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24. In order to bring in more investors, EmpiresX used a multi-level marketing
plan to sell its investment products and provided incentives, including commissions and
prizes, for current investors to find new investors.
25. For example, both investors in the Exbot and the private investment
programs received a 5% commission of the initial investment amount for anyone they
persuaded to invest in EmpiresX.  EmpiresX also offered prizes to all investors whose
downstream “network” sold between $16,000 and $80 million in investments, including
electronics, travel vouchers, a Rolex watch, and various luxury vehicles.  The more new
money investors brought in, the more expensive the prizes Defendants offered.
26. The only information EmpiresX required investors to provide in order to
invest was their name and email address.  Defendants otherwise conducted no due
diligence concerning the investors’ residency, financial situation, risk tolerance, or
accredited investor status.
27. To invest, new investors submitted payment of money to an EmpiresX bank
account or sent Bitcoin or Ether to an EmpiresX digital wallet.
28. For investors who invested using crypto, in an October 11, 2021 Zoom
meeting with investors, Pires explained that after EmpiresX received investors’ crypto, it
converted the crypto into fiat currency, which was then deposited into a bank account and
transferred to an EmpiresX brokerage account.
29. After investors created and funded their accounts, investors could log onto
their “back office,” the section of EmpiresX website where investors accessed their
accounts with their username and password.

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30. By accessing their account on their back office, investors could monitor
their purported daily balance and returns, fund their principal, monitor commissions earned
from recruiting new investors, and request withdrawals.
Defendants Promised Safety, Transparency, and Outsized Returns
31. On multiple Zoom calls with investors, Defendants displayed a PowerPoint
presentation that described the EmpiresX investment program.  Defendants also posted the
PowerPoint on EmpiresX’s website.
32. While Defendants at times showed investors slightly different versions of
the PowerPoint, each version contained the statements described below.
33. The PowerPoint described ExpiresX’s mission as helping investors
“manage and multiply assets with transparency and safety.”
34. The PowerPoint noted that while many investors lost money during the
COVID pandemic, even in a down market EmpiresX had an “exponential profit.”  The
PowerPoint thus described EmpiresX as having 30% monthly growth and a “6000%
expectation for 2023.”
35. The PowerPoint then showed examples of investors’ 1% daily profits, such
as a $10,000 investment generating $100 per day in returns and 30% returns made in only
a month.  According to Defendants, by compounding their returns investors could “make
thousands turn into millions in a matter of months!”
36. On various Zoom calls with investors over the course of their scheme
Defendants made similar claims of 1% daily profits, 30% (or more) monthly returns, and
“triple digits” annual returns.

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EmpiresX’s Fake Trading Bot
37. One of the investment options Defendants presented to investors was
EmpiresX’s “Exbot” automated trading bot.  Defendants told investors that the Exbot was
directly connected to EmpiresX’s brokerage account at a major U.S. brokerage firm
(“Brokerage Firm A”).
38. Defendants told investors they could license the Exbot, operate it to trade
their invested principal, and that the bot would generate 1% daily returns.
39. Pires told investors that they and EmpiresX would engage in profit sharing,
with EmpiresX receiving 20% of the investors’ returns and investors retaining the
remaining 80%.  In a July 2, 2021 investor meeting, Goncalves told investors that the 20%
daily profit taken from each investor’s daily Exbot earnings was reinvested in EmpiresX.
40. In order to use the Exbot, investors had to pay annual licensing fees ranging
from $200-$400, invest a minimum of $500, and deposit more money to fund a separate
“credit balance” account from which EmpiresX deducted their 20% fees.  EmpiresX
pooled the money it received from the Exbot investors.
41.   Goncalves told investors that the money from the credit balance account
was “thrown back into the company” in order to run the Exbot each day.  Once that credit
balance declined to zero, investors lost access to the Exbot until they added new funds to
their account.
42. In various Zoom meetings with investors and prospective investors,
Defendants falsely represented that the Exbot was connected to EmpiresX’s online account
at Brokerage Firm A and showed the Exbot purportedly actively trading in that account.

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43.  In several investor Zoom meetings, Goncalves demonstrated how the Exbot
purportedly worked.  He showed what happens by clicking “Start” or “Run Bot” on the
EmpiresX “back office” and the reference codes that reflected executed trades.  He then
searched for those reference codes on a purported Brokerage Firm A website and showed
investors that the trades confirmed on EmpiresX’s back office also appeared in EmpiresX’s
account at Brokerage Firm A.
44. In an October 14, 2021 investor meeting, Goncalves showed that the cash
balance of EmpiresX’s online account at Brokerage Firm A had a balance of $136.7
million and had grown by $20 million in less than a week, and stated “we already hit our
mark of $110 million just like we said.”
45. After investing, investors could log onto their “back office” on EmpiresX’s
website and, once per day, click a button to purportedly activate the Exbot or otherwise
choose to have the bot run automatically every day.
46. Investors were unable to choose the financial instruments or strategy in
which the Exbot invested.  Instead, while the Exbot was in operation, investors’
EmpiresX’s back office simply displayed a graphic showing the bot running and
generating trades, each with its own profit or loss.
47. After the Exbot “earned” its 1% return for that day, which only required
several minutes, the bot would stop running.  EmpiresX’s back office would then display
the purported value of the investor’s funds resulting from the Exbot’s trades.
48. The representations Defendants made to investors about the Exbot were
lies.  Defendants made these materially fraudulent statements knowingly or recklessly.

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The bot was not connected to an EmpiresX account at Brokerage Firm A.  In fact,
EmpiresX did not even have an account at Brokerage Firm A.  And, without any actual
trading by the Exbot, the 1% daily returns were fictitious.
49. In reality, the online Brokerage Firm A account shown to investors during
live Zoom meetings was fake.  Unbeknownst to investors, the Brokerage Firm A online
account shown to investors was actually a website registered to a company owned by
Goncalves, which was designed to simulate an actual online account at Brokerage Firm A.
EmpiresX’s Fraudulent “Private” Investment Program
50. In addition to the Exbot, Defendants also offered and sold “private”
investments, which Defendants said would generate 1% daily returns from manual trading
performed by Nicholas.
51. For the private investments, in Zoom meetings Goncalves and Nicholas
showed investors EmpiresX’s investment performance as reflected in an online account at
another major U.S. brokerage (“Brokerage Firm B”) belonging to EmpiresX.  Goncalves
and Nicholas referred to the account as a “hedge fund” whose profits were derived from
Nicholas’s selection of investments and timing of trades.
52. For instance, in a November 4, 2021 Zoom meeting with investors,
Nicholas touted the private investments’ performance by showing investors EmpiresX’s
account at Brokerage Firm B, which at that time had a balance of $1.69 million and gains
of $369,643 in one month (a month in which the broader stock market posted significant
gains).  Nicholas told investors that $400,000 was deposited into this brokerage account in
June 2021 and that by November the account is on the “precipice of $1.7 million.”

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Nicholas claimed that the trading results in EmpiresX’s account at Brokerage Firm B
outperformed the market.  Pires added that no matter what happens to the market,
EmpiresX still provides “amazing profits.”
53. As with the Exbot investors, the private investment investors could monitor
the purported performance of their investments on their back office section of EmpiresX’s
website.  For these investors, their back office would display the daily 1% profits
Defendants told investors were earned through Nicholas’s manual trading.
54. As with the Exbot, Defendants’ representations about the private
investments’ performance were lies.  Defendants made these material and fraudulent
statements knowingly or recklessly.  In reality, whatever manual trading Nicholas actually
performed did not generate 1% daily profits.  In fact, much of Nicholas’s trading resulted
in significant losses.
55. Nicholas’s representations about the Brokerage Firm B account were
similarly materially false and misleading.  Most of the funds in the account were not
profits, but instead were approximately $1 million of pooled investor funds that EmpiresX
deposited into the account between April 16, 2021 and June 4, 2021.  By early 2022,
Nicholas’s trading had lost nearly all of the money in the account.
EmpiresX’s Website Displayed Fake Investor Account Balances
56. For both the Exbot and private investors, Defendants used EmpiresX’s back
office to materially and knowingly misrepresent the investors’ account balances.
57. Those online accounts purportedly showed investors their daily profits and
commissions earned, which led investors to believe they were making money from their

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investments and recruitment of other investors.  Such representations led investors to re-
invest their “profits,” thereby delaying the time when EmpiresX would have to pay
investors their proceeds.  Various investors also invested fresh funds or recruited new
investors based on the profits they believed were generated by their original investments.
58. In fact, the investor account balances were fictional and EmpiresX stopped
honoring investor withdrawal requests after November 2021.
Defendants’ Lies About SEC Registration
59. To make investors more comfortable with investing in EmpiresX, in Zoom
meetings with investors, Defendants explained the importance of being a SEC-registered
hedge fund.  Defendants told investors that EmpiresX filed to be a registered hedge fund
with the SEC, and said EmpiresX received comments back from the SEC and was
preparing documents for re-submission to the SEC.
60. For example, on a September 9, 2021 Zoom call, Nicholas showed investors
a “Prospectus” for a purported hedge fund controlled by Empires X, which would issue
approximately 80 million shares at a price of $25 per share.  Nicholas stated that this
Prospectus would be filed with the SEC as soon as EmpiresX reached $100 million in
assets under management, which Nicholas suggested to investors would occur in the
coming days.
61. During that same presentation, Nicholas also showed investors contract
documents that he claimed would be filed with the SEC.  Nicholas concluded the
presentation by showing an official-looking SEC document – which was actually a SEC
cease-and-desist order issued against an unrelated entity – and falsely stated that after the

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SEC finished its review of EmpiresX’s paperwork, the SEC would issue a similar
document “verifying everything that we already have created.”
62. In an October 11, 2021 Zoom meeting with investors, Pires and Nicholas
falsely told investors that EmpiresX had filed paperwork with the SEC, that the SEC
provided feedback, and that EmpiresX had made a revised filing with the SEC.
63. In an October 21, 2021 Zoom meeting with investors, Goncalves similarly
lied by stating that EmpiresX made a revised filing with the SEC.  Goncalves added that he
was “pretty sure” that EmpiresX would receive “SEC approval.”
64. Nicholas also lied to investors about EmpiresX’s SEC registration status by
directing them to the SEC filings of an unrelated company with a similar sounding name
that contained the term “EmpireX.”  In particular, in the October 11, 2021 Zoom meeting,
Nicholas told investors that they could check the status of EmpiresX’s filing with the SEC
by going to sec.gov, searching for “EmpiresX,” and see the paperwork EmpiresX had filed.
65. After learning that EmpiresX was improperly directing investors to its SEC
filings, the true filer with a similar name issued a press release that “den[ied] the
statements of the ... company ‘EmpiresX’ which has been illegally using our Name,
Address, and Financial License from the United States to deceive people worldwide with
fraudulent investment operations.”
66. Defendants’ statements about filings, registrations, and communications
with the SEC were knowingly or recklessly false and material.  The SEC never received
any registration paperwork or filing from, and never provided feedback or suggestions to,
EmpiresX.

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Defendants’ Touted Nicholas’s Credentials Yet Concealed His Disciplinary History
67. Similar to their lies about EmpiresX’s registration with the SEC,
Defendants touted to investors Nicholas’s background, trading experience, and securities
licenses, yet failed to disclose Nicholas’s disciplinary history.  Defendants’ knowingly or
recklessly omitted this material information.
68. As a result of his initial NFA suspension in September 2020, which the
NFA extended for eight-years in April 2021, Nicholas could not trade or associate with any
firm that traded futures, options, or commodities on behalf of investors.
69. Nevertheless, in various recorded meetings with investors, Defendants
represented that Nicholas was a licensed and registered trader.  But during those meetings
Defendants failed to disclose Nicholas’s NFA suspension or that the suspension was based
on allegations that Nicholas misappropriated client assets.
70. For example, in the July 2, 2021 Zoom meeting with investors, Goncalves
said that EmpiresX would display Nicholas’s license for investors to see and that without
the license, EmpiresX would not be able to make “one single trade.”  Nicholas then
navigated to the FINRA “Brokercheck” page of an unrelated registered trader at a
prominent investment bank with a name similar to Nicholas’s.  The Brokercheck page
Nicholas referenced to investors as being about him thus displayed information for a
different trader with no disciplinary history and a variety of securities licenses.
71. Only after online blogs publicized Nicholas’ disciplinary history, Nicholas
acknowledged his NFA suspension in a July 30, 2021 Zoom meeting with investors.
Nevertheless, in subsequent investor meetings, Defendants would continue to promote

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Nicholas’s trading expertise without mentioning his suspension.
Defendants’ Material Misrepresentations
About Investors’ Ability to Withdraw Their Money

72. To promote the investments and encourage investors to reinvest their
“profits,” Defendants told investors and prospective investors that they could compound
their interest and also easily withdraw their funds.
73. For example, the PowerPoint Defendants showed to investors initially
represented that investors could withdraw their profits either weekly (for Exbot investors)
or monthly (for “private” investors), and withdraw their capital “anytime, any day.”
74.  Similarly, in a July 30, 2021 Zoom meeting with investors, Goncalves
represented that investors could withdraw their funds “whenever you want.”
75. Having been told they could easily withdraw their money, most investors
decided to reinvest their purported profits.
76. To further discourage withdrawals, EmpiresX charged fees including a 20%
fee for any withdrawals made within the first month of investing, which decreased to 0.5%
for subsequent months.
77. In October 2021, without any notice to investors, Defendants changed the
rules for Exbot investors to withdraw their profits, from weekly to monthly.  Additionally,
EmpiresX increased the withdrawal fees for both Exbot and private investors, such that the
fee increased to 40% for withdrawals made within the first month of investing, 20% for
withdrawals made within 60 days of investing, and 10% for withdrawals made within 90
days of investing.

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78. EmpiresX also instituted a new rule that investors could only withdraw their
capital three times and thereafter, their accounts were closed.  These higher fees caused
some investors to wait several months before requesting to withdraw funds from their
accounts.  Investors who invested prior to October 2021 invested without having notice of
these material changes to the withdrawal rules and fees.
Defendants’ Misuse of Investor Funds
79. Between November 2020 and December 2021, EmpiresX received at least
$40 million in investor funds.
80. Despite Defendants’ representations that investors’ money would be
deployed for trading, of this amount, Defendants only transferred approximately $1 million
of investors’ funds to EmpiresX’s account at Brokerage Firm B.
81. Therefore, rather than use investors’ funds for trading, Defendants
misappropriated a large amount of the money received from investors.
82. For instance, Pires diverted investor funds for personal expenditures
including the following:  $300,000 in travel expenses, $250,000 in home renovations,
$125,000 for a down payment on another home, $70,000 for the lease down payment for a
Lamborghini Urus, $47,000 in apparel, $33,000 in meals and groceries, $19,000 in
mortgage payments, and $15,000 in home décor.  Pires also paid nearly $358,000 to
another company he manages, and transferred over $250,000 to himself, relatives, and
associates.
83. For his part, Goncalves received at least $421,000 of investor funds, and his
relatives received at least an additional $99,000.  Goncalves used the investor money for

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personal uses including the following:  $69,000 at luxury hotels, $43,285 in lease
payments for a Ferrari 488 GTB, $7,000 to Jaguar Land Rover, $3,000 to Tiffany & Co.,
and on other personal expenditures, including grocery shopping and a gym membership.
84. In less than one year, between May 2021 and April 2022, Nicholas received
at least $289,000 of investor funds, which he likewise spent on personal uses.
Defendants’ Scheme Collapses
85. By approximately November 2021, EmpiresX stopped honoring investor
withdrawals, providing investors with the fake excuse that it had to process withdrawals
manually rather than automatically due to technical difficulties at its crypto trading firm.
86. Then, in January 2022, blaming unspecified “deleterious acts” and
unidentified “stakeholders [who] have violated standards and acted in ways that purport to
harm the company,” EmpiresX stated in a written announcement to investors that it would
repay all investor funds and dissolve by the end of February 2022.
87. This promise of repayment was false.  Since November 2021, EmpiresX has
failed to honor withdrawal requests or otherwise repay its defrauded investors.
88. In the meantime, after receiving subpoenas as part of the SEC’s
investigation, Pires and Goncalves began winding down EmpiresX’s operations in the
United States.  On information and belief, they have relocated to Brazil, where they are
both citizens.
COUNT I
Violations of Sections 5(a) and (c) of the Securities Act
(Against All Defendants)
89. Paragraphs 1 through 88 are realleged and incorporated by reference.

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90. At all times alleged in this Complaint, no registration statement was filed or
in effect with the SEC pursuant to the Securities Act with respect to the securities and
transactions issued by EmpiresX described in this Complaint, and no exemption from
registration existed with respect to these securities and transactions.
91. By their conduct, Defendants EmpiresX, Pires, Goncalves, and Nicholas,
directly and indirectly:
(a) made use of any means or instruments of transportation or
communication in interstate commerce or of the mails to sell
securities, through the use or medium of a prospectus or otherwise;
(b) carried or caused to be carried securities through the mails or in
interstate commerce, by any means or instruments of transportation,
for the purpose of sale or delivery after sale; or
(c) made use of any means or instruments of transportation or
communication in interstate commerce or of the mails to offer to
sell or offer to buy through the use or medium of any prospectus or
otherwise any security,
without a registration statement having been filed or being in effect with the SEC as to
such securities.
92. By reason of the foregoing, Defendants EmpiresX, Pires, Goncalves, and
Nicholas violated and, unless enjoined, are reasonably likely to continue to violate
Sections 5(a) and 5(c) of the Securities Act [15 U.S.C. §§ 77e(a) and 77e(c)].
COUNT II
Violations of Section 17(a)(1) of the Securities Act
(Against All Defendants)
93. Paragraphs 1 through 88 are realleged and incorporated by reference as
though fully set forth herein.

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94. By engaging in the conduct described above, Defendants EmpiresX, Pires,
Goncalves, and Nicholas, in the offer and sale of securities, by the use of the means and
instruments of transportation or communication in interstate commerce or by use of the
mails, directly or indirectly, have employed devices, schemes and artifices to defraud.
95. Defendants acted knowingly or recklessly in engaging in the fraudulent
conduct described above.
96. By engaging in the conduct described above, Defendants violated Section
17(a)(1) of the Securities Act [15 U.S.C. § 77q(a)(1)] in the manner set forth above.
COUNT III
Violations of Section 17(a)(2) of the Securities Act
(Against All Defendants)
97. Paragraphs 1 through 88 are realleged and incorporated by reference as
though fully set forth herein.
98. By engaging in the conduct described above, Defendants EmpiresX, Pires,
Goncalves, and Nicholas, in the offer and sale of securities, by the use of the means and
instruments of transportation or communication in interstate commerce or by use of the
mails, directly or indirectly, have obtained money and property by means of untrue
statements of material fact and by omitting to state material facts necessary to make the
statements made, in light of the circumstances under which they were made, not
misleading.
99. Defendants acted knowingly or recklessly in engaging in the fraudulent
conduct described above.
100. Defendants also acted negligently in engaging in the conduct described

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above.
101. By engaging in the conduct described above, Defendants violated Section
17(a)(2) of the Securities Act [15 U.S.C. § 77q(a)(2)] in the manner set forth above.
COUNT IV
Violations of Section 17(a)(3) of the Securities Act
(Against All Defendants)
102. Paragraphs 1 through 88 are realleged and incorporated by reference as
though fully set forth herein.
103. By engaging in the conduct described above, Defendants EmpiresX, Pires,
Goncalves, and Nicholas, in the offer and sale of securities, by the use of the means and
instruments of transportation or communication in interstate commerce or by use of the
mails, directly or indirectly, have engaged in transactions, practices, and courses of
business which operated or would operate as a fraud or deceit upon the purchasers of such
securities.
104. Defendants acted knowingly or recklessly in engaging in the fraudulent
conduct described above.
105. Defendants also acted negligently in engaging in the conduct described
above.
106. By engaging in the conduct described above, Defendants violated Section
17(a)(3) of the Securities Act [15 U.S.C. § 77q(a)(3)] in the manner set forth above.
COUNT V
Violations of Section 10(b) of the Exchange Act and Exchange Act Rule 10b-5(a)
(Against All Defendants)
107. Paragraphs 1 through 88 are realleged and incorporated by reference.

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108. As more fully described in paragraphs 1 through 88 above, Defendants
EmpiresX, Pires, Goncalves, and Nicholas, in connection with the purchase and sale of
securities, by the use of the means and instrumentalities of interstate commerce and by the
use of the mails, directly and indirectly, used and employed devices, schemes and artifices
to defraud.
109. Defendants knew, or were reckless in not knowing, of the facts and
circumstances described in paragraphs 1 through 88 above.
110. By reason of the foregoing, Defendants violated Section 10(b) of the
Exchange Act [15 U.S.C. § 78j(b)] and Rule 10b-5(a) thereunder [17 C.F.R. 240.10b-5(a)]
in the manner set forth above.
COUNT VI
Violations of Section 10(b) of the Exchange Act and Exchange Act Rule 10b-5(b)
(Against All Defendants)
111. Paragraphs 1 through 88 are realleged and incorporated by reference.
112. As more fully described in paragraphs 1 through 88 above, Defendants
EmpiresX, Pires, Goncalves, and Nicholas, in connection with the purchase and sale of
securities, by the use of the means and instrumentalities of interstate commerce and by the
use of the mails, directly and indirectly, made untrue statements of material fact and
omitted to state material facts necessary in order to make the statements made, in light of
the circumstances under which they were made, not misleading.
113. Defendants knew, or were reckless in not knowing, of the facts and
circumstances described in paragraphs 1 through 88 above.
114. By reason of the foregoing, Defendants violated Section 10(b) of the

22
Exchange Act [15 U.S.C. § 78j(b)] and Rule 10b-5(b) thereunder [17 C.F.R. 240.10b-5(b)]
in the manner set forth above.
COUNT VII
Violations of Section 10(b) of the Exchange Act and Exchange Act Rule 10b-5(c)
(Against All Defendants)
115. Paragraphs 1 through 88 are realleged and incorporated by reference.
116. As more fully described in paragraphs 1 through 88 above, Defendants
EmpiresX, Pires, Goncalves, and Nicholas, in connection with the purchase and sale of
securities, by the use of the means and instrumentalities of interstate commerce and by the
use of the mails, directly and indirectly, engaged in acts, practices and courses of business
which operated or would have operated as a fraud and deceit upon purchasers and sellers
and prospective purchasers and sellers of securities.
117. Defendants knew, or were reckless in not knowing, of the facts and
circumstances described in paragraphs 1 through 88 above.
118. By reason of the foregoing, Defendants violated Section 10(b) of the
Exchange Act [15 U.S.C. § 78j(b)] and Rule 10b-5(c) thereunder [17 C.F.R. 240.10b-5(c)]
in the manner set forth above.
RELIEF REQUESTED
 WHEREFORE, the SEC respectfully requests that this Court:
I.
 Issue permanent injunctions restraining and enjoining Defendants from violating
Sections 5(a), 5(c), and 17(a) of the Securities Act [15 U.S.C. §§ 77e(a), (c), and 77q(a)];
and Section 10(b) of the Exchange Act [15 U.S.C. § 78j] and Rule 10b-5 thereunder [17

23
CFR § 240.10b-5]; and from soliciting any new investors, accepting additional funds from
existing investors, or issuing, purchasing, offering, or selling any security.
II.
Order Defendants EmpiresX, Pires and Goncalves to disgorge, jointly and
severally, and Nicholas to disgorge, the ill-gotten gains received because of the violations
alleged herein, including prejudgment interest, pursuant to Sections 21(d)(5) and 21(d)(7)
of the Exchange Act [15 U.S.C. §§ 78u(d)(5) and 78u(d)(7)].
III.
Order Defendants to pay civil 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)].
IV.
 Permanently bar defendants Pires and Goncalves from serving as an officer or
director of any company 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)], pursuant to Section 21(d)(2) of the
Exchange Act [15 U.S.C. § 78u(d)(2)].
V.
 Grant such other relief as this Court deems appropriate.
JURY DEMAND
 The SEC hereby requests a trial by jury.

24
UNITED STATES SECURITIES AND
EXCHANGE COMMISSION

Date: June 30, 2022
  /s/ Benjamin J. Hanauer           _
By: Benjamin J. Hanauer
      One of Its Attorneys

Benjamin J. Hanauer
Senior Trial Counsel
S.D. Fla. No. A5502908
Direct Dial: (312) 353-8642
Email: [email protected]

Christine B. Jeon
S.D. Fla. No. A5502884
Senior Counsel
Direct Dial: (312) 353-7419
Email: [email protected]

Devlin Su
Senior Counsel
S.D. Fla. No. A5502883
Direct Dial: (312) 596-6012
Email: [email protected]

Attorneys for Plaintiff
UNITED STATES SECURITIES
  AND EXCHANGE COMMISSION
175 W. Jackson Blvd., Suite 1450
Chicago, Illinois 60604
Tel: (312) 353-7390

UNITED STATES DISTRICT COURT 
SOUTHERN DISTRICT OF FLORIDA 

 
UNITED STATES SECURITIES AND 
EXCHANGE COMMISSION, 

  

  
Plaintiff, 

 
 

 

          
              v. 
 

 
 

 
 
 

 
Case No. 1:22cv21995 

EMPIRES CONSULTING CORP. (DBA 
“EMPIRESX”), EMERSON SOUSA PIRES, 
FLAVIO MENDES GONCALVES,  
and JOSHUA DAVID NICHOLAS, 

  

  
Defendants.  

  

______________________________________/   

COMPLAINT 

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

1. This case stems from an illegal offering fraud scheme perpetrated by 

Defendants Emerson Sousa Pires and Flavio Mendes Goncalves, their company, Defendant 

Empires Consulting Corp. (“EmpiresX”), and EmpiresX’s head trader, Defendant Joshua 

David Nicholas (collectively, “Defendants”).  In less than two years, Defendants raised at 

least $40 million by selling EmpiresX investments to thousands of investors. 

2. Defendants lured investors with claims of “exponential” profits, expected 

investment returns of 1% per day, and the prospect of making millions of dollars “in a 

matter of months.”  Defendants told investors that EmpiresX would generate these outsized 

returns either through a proprietary trading “bot” or by manual trading performed by 

Defendant Nicholas.  But these statements were lies.  In reality, the bot was fake, 

Defendants traded only a fraction of the funds they took from investors, and that limited 

trading failed to earn anywhere near the expected returns Defendants touted to investors.   

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3. Instead, Defendants misappropriated large sums of investors’ money for 

personal uses such as luxury cars, real estate, and travel.  

4. Beyond their untrue claims of 1% daily profits earned by bot or manual 

trading, Defendants further lied to investors to give them assurances of the “transparency 

and safety” of their investments, even during market downturns.  To that end, Defendants 

falsely told investors that EmpiresX had filed paperwork with the SEC to register as a 

hedge fund, and directed investors to the filings of an unaffiliated hedge fund with a name 

similar to EmpiresX that actually had registered with the SEC.  Similarly, Defendants 

touted Nicholas as a licensed trader and deceptively showed investors the credentials of a 

different trader with a similar name to Nicholas, while concealing that Nicholas had been 

suspended from trading for misappropriating customer funds.   

5. As their scheme began to collapse, Defendants broke earlier promises that 

investors could easily withdraw their money and later assurances of repayment.  Instead, 

Defendants refused to honor investor requests to withdraw their funds and gave phony 

excuses why the investors could not be repaid.   

6. After learning of the SEC’s investigation, Defendants Pires and Goncalves 

began winding down EmpiresX’s United States operations and, in an effort to escape 

liability, relocated to Brazil.  They left investors with heavy losses. 

7. In addition to being fraudulent, Defendants’ offers and sales of EmpiresX 

securities violated the registration provisions of the federal securities laws.  

8. The SEC brings this lawsuit to hold Defendants responsible for their fraud, 

prevent them from harming future investors, and return money to Defendants’ victims.  

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JURISDICTION AND VENUE 

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

of 1933 (“Securities Act”) [15 U.S.C. § 77t(b)] and Sections 21(d) and 21(e) of the 

Securities Exchange Act of 1934 (“Exchange Act”) [15 U.S.C. §§ 78u(d) and 78u(e)]. 

10. This Court has jurisdiction over this action pursuant to Section 22 of the 

Securities Act [15 U.S.C. § 77v], Section 27 of the Exchange Act [15 U.S.C. § 78aa], and 

28 U.S.C. § 1331. 

11. Venue is proper in this Court pursuant to Section 27 of the Exchange Act 

[15 U.S.C. § 78aa].  Acts, practices and courses of business constituting violations alleged 

herein have occurred within the jurisdiction of the United States District Court for the 

Southern District of Florida and elsewhere. 

12. Defendants directly and indirectly made use of the means and 

instrumentalities of interstate commerce and of the mails in connection with the acts, 

practices, and courses of business alleged herein, and will continue to do so unless 

enjoined. 

DEFENDANTS 

13. Defendant Empires Consulting Corp. (dba “EmpiresX”) is a Florida 

corporation with its principal place of business formerly in Fort Myers, Florida.  

Defendants Pires and Goncalves founded EmpiresX in 2020.  EmpiresX is not registered 

with the SEC in any capacity, nor has it ever registered any offering of securities under the 

Securities Act or any class of securities under the Exchange Act.  

 

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14. Defendant Emerson Sousa Pires (“Pires”), age 33, formerly of Fort 

Myers, Florida, is EmpiresX’s co-founder, president, director, and registered agent.  Pires 

now resides in Brazil, where he is a citizen.  When Pires registered EmpiresX as a 

corporation with the State of Florida, he listed his home address in Fort Myers – an address 

at which Pires no longer resides after relocating to Brazil – as EmpiresX’s principal, 

registered agent, and mailing address.   

15. Defendant Flavio Mendes Goncalves (“Goncalves”), age 34, formerly of 

Port St. Lucie, Florida, is EmpiresX’s co-founder, vice president, and director.  Goncalves 

now resides in Brazil, where he is a citizen.  

16. Defendant Joshua David Nicholas (“Nicholas”), age 28, of Stuart, Florida, 

was EmpiresX’s head trader.  For brief periods in 2016 and 2020, Nicholas was a 

registered representative and investment adviser representative associated with broker-

dealers and investment advisers.  In September 2020, the National Futures Association 

(“NFA”) suspended Nicholas from membership and prohibited him from association with 

any NFA member, after Nicholas misappropriated client funds in order to fund a personal 

trading account.  In April 2021, the NFA extended Nicholas’s suspension for an additional 

eight years.  In January 2022, the Financial Industry Regulatory Authority (“FINRA”) 

barred Nicholas from associating with registered broker-dealers, as a result of that same 

conduct. 

 

 

 

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FACTS 

Overview of EmpiresX 

17. In late 2020, Pires and Goncalves founded EmpiresX and based the 

company in South Florida.  Pires and Goncalves controlled EmpiresX, including its 

operations, the content of representations made to investors, and how EmpiresX used funds 

received from investors.  

18.  Since its formation, EmpiresX raised at least $40 million from thousands of 

investors worldwide, including many investors in the United States, by offering and selling 

investments that Defendants claimed earned 1% daily returns. 

19. None of the securities or securities offerings described herein were 

registered with the SEC. 

20. Defendants represented to investors that EmpiresX was a hedge fund that 

planned to manage over $100 million in investor funds and had filed with the SEC to 

become a U.S. registered hedge fund.  

21. Defendants lured investors by offering and selling two different investment 

options that would each purportedly generate the 1% daily returns. 

22. The first investment option Defendants presented to investors were licenses 

to use EmpiresX’s trading bot, which Defendants called the “Exbot.” 

23. The second investment option Defendants presented to investors were 

“private” investments that involved the pooling of investor funds in EmpiresX’s brokerage 

accounts, which Nicholas would use to manually trade stock, options, and futures.   

 

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24. In order to bring in more investors, EmpiresX used a multi-level marketing 

plan to sell its investment products and provided incentives, including commissions and 

prizes, for current investors to find new investors.   

25. For example, both investors in the Exbot and the private investment 

programs received a 5% commission of the initial investment amount for anyone they 

persuaded to invest in EmpiresX.  EmpiresX also offered prizes to all investors whose 

downstream “network” sold between $16,000 and $80 million in investments, including 

electronics, travel vouchers, a Rolex watch, and various luxury vehicles.  The more new 

money investors brought in, the more expensive the prizes Defendants offered.  

26. The only information EmpiresX required investors to provide in order to 

invest was their name and email address.  Defendants otherwise conducted no due 

diligence concerning the investors’ residency, financial situation, risk tolerance, or 

accredited investor status.   

27. To invest, new investors submitted payment of money to an EmpiresX bank 

account or sent Bitcoin or Ether to an EmpiresX digital wallet. 

28. For investors who invested using crypto, in an October 11, 2021 Zoom 

meeting with investors, Pires explained that after EmpiresX received investors’ crypto, it 

converted the crypto into fiat currency, which was then deposited into a bank account and 

transferred to an EmpiresX brokerage account.   

29. After investors created and funded their accounts, investors could log onto 

their “back office,” the section of EmpiresX website where investors accessed their 

accounts with their username and password.   

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30. By accessing their account on their back office, investors could monitor 

their purported daily balance and returns, fund their principal, monitor commissions earned 

from recruiting new investors, and request withdrawals.  

Defendants Promised Safety, Transparency, and Outsized Returns 

31. On multiple Zoom calls with investors, Defendants displayed a PowerPoint 

presentation that described the EmpiresX investment program.  Defendants also posted the 

PowerPoint on EmpiresX’s website.   

32. While Defendants at times showed investors slightly different versions of 

the PowerPoint, each version contained the statements described below.    

33. The PowerPoint described ExpiresX’s mission as helping investors 

“manage and multiply assets with transparency and safety.”   

34. The PowerPoint noted that while many investors lost money during the 

COVID pandemic, even in a down market EmpiresX had an “exponential profit.”  The 

PowerPoint thus described EmpiresX as having 30% monthly growth and a “6000% 

expectation for 2023.” 

35. The PowerPoint then showed examples of investors’ 1% daily profits, such 

as a $10,000 investment generating $100 per day in returns and 30% returns made in only 

a month.  According to Defendants, by compounding their returns investors could “make 

thousands turn into millions in a matter of months!” 

36. On various Zoom calls with investors over the course of their scheme 

Defendants made similar claims of 1% daily profits, 30% (or more) monthly returns, and 

“triple digits” annual returns.   

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EmpiresX’s Fake Trading Bot 

37. One of the investment options Defendants presented to investors was 

EmpiresX’s “Exbot” automated trading bot.  Defendants told investors that the Exbot was 

directly connected to EmpiresX’s brokerage account at a major U.S. brokerage firm 

(“Brokerage Firm A”). 

38. Defendants told investors they could license the Exbot, operate it to trade 

their invested principal, and that the bot would generate 1% daily returns.   

39. Pires told investors that they and EmpiresX would engage in profit sharing, 

with EmpiresX receiving 20% of the investors’ returns and investors retaining the 

remaining 80%.  In a July 2, 2021 investor meeting, Goncalves told investors that the 20% 

daily profit taken from each investor’s daily Exbot earnings was reinvested in EmpiresX. 

40. In order to use the Exbot, investors had to pay annual licensing fees ranging 

from $200-$400, invest a minimum of $500, and deposit more money to fund a separate 

“credit balance” account from which EmpiresX deducted their 20% fees.  EmpiresX 

pooled the money it received from the Exbot investors.  

41.   Goncalves told investors that the money from the credit balance account 

was “thrown back into the company” in order to run the Exbot each day.  Once that credit 

balance declined to zero, investors lost access to the Exbot until they added new funds to 

their account. 

42. In various Zoom meetings with investors and prospective investors, 

Defendants falsely represented that the Exbot was connected to EmpiresX’s online account 

at Brokerage Firm A and showed the Exbot purportedly actively trading in that account.  

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43.  In several investor Zoom meetings, Goncalves demonstrated how the Exbot 

purportedly worked.  He showed what happens by clicking “Start” or “Run Bot” on the 

EmpiresX “back office” and the reference codes that reflected executed trades.  He then 

searched for those reference codes on a purported Brokerage Firm A website and showed 

investors that the trades confirmed on EmpiresX’s back office also appeared in EmpiresX’s 

account at Brokerage Firm A.     

44. In an October 14, 2021 investor meeting, Goncalves showed that the cash 

balance of EmpiresX’s online account at Brokerage Firm A had a balance of $136.7 

million and had grown by $20 million in less than a week, and stated “we already hit our 

mark of $110 million just like we said.” 

45. After investing, investors could log onto their “back office” on EmpiresX’s 

website and, once per day, click a button to purportedly activate the Exbot or otherwise 

choose to have the bot run automatically every day.  

46. Investors were unable to choose the financial instruments or strategy in 

which the Exbot invested.  Instead, while the Exbot was in operation, investors’ 

EmpiresX’s back office simply displayed a graphic showing the bot running and 

generating trades, each with its own profit or loss.  

47. After the Exbot “earned” its 1% return for that day, which only required 

several minutes, the bot would stop running.  EmpiresX’s back office would then display 

the purported value of the investor’s funds resulting from the Exbot’s trades.   

48. The representations Defendants made to investors about the Exbot were 

lies.  Defendants made these materially fraudulent statements knowingly or recklessly.  

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The bot was not connected to an EmpiresX account at Brokerage Firm A.  In fact, 

EmpiresX did not even have an account at Brokerage Firm A.  And, without any actual 

trading by the Exbot, the 1% daily returns were fictitious. 

49. In reality, the online Brokerage Firm A account shown to investors during 

live Zoom meetings was fake.  Unbeknownst to investors, the Brokerage Firm A online 

account shown to investors was actually a website registered to a company owned by 

Goncalves, which was designed to simulate an actual online account at Brokerage Firm A. 

EmpiresX’s Fraudulent “Private” Investment Program 

50. In addition to the Exbot, Defendants also offered and sold “private” 

investments, which Defendants said would generate 1% daily returns from manual trading 

performed by Nicholas. 

51. For the private investments, in Zoom meetings Goncalves and Nicholas 

showed investors EmpiresX’s investment performance as reflected in an online account at 

another major U.S. brokerage (“Brokerage Firm B”) belonging to EmpiresX.  Goncalves 

and Nicholas referred to the account as a “hedge fund” whose profits were derived from 

Nicholas’s selection of investments and timing of trades.   

52. For instance, in a November 4, 2021 Zoom meeting with investors, 

Nicholas touted the private investments’ performance by showing investors EmpiresX’s 

account at Brokerage Firm B, which at that time had a balance of $1.69 million and gains 

of $369,643 in one month (a month in which the broader stock market posted significant 

gains).  Nicholas told investors that $400,000 was deposited into this brokerage account in 

June 2021 and that by November the account is on the “precipice of $1.7 million.”  

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Nicholas claimed that the trading results in EmpiresX’s account at Brokerage Firm B 

outperformed the market.  Pires added that no matter what happens to the market, 

EmpiresX still provides “amazing profits.” 

53. As with the Exbot investors, the private investment investors could monitor 

the purported performance of their investments on their back office section of EmpiresX’s 

website.  For these investors, their back office would display the daily 1% profits 

Defendants told investors were earned through Nicholas’s manual trading.   

54. As with the Exbot, Defendants’ representations about the private 

investments’ performance were lies.  Defendants made these material and fraudulent 

statements knowingly or recklessly.  In reality, whatever manual trading Nicholas actually 

performed did not generate 1% daily profits.  In fact, much of Nicholas’s trading resulted 

in significant losses.    

55. Nicholas’s representations about the Brokerage Firm B account were 

similarly materially false and misleading.  Most of the funds in the account were not 

profits, but instead were approximately $1 million of pooled investor funds that EmpiresX 

deposited into the account between April 16, 2021 and June 4, 2021.  By early 2022, 

Nicholas’s trading had lost nearly all of the money in the account. 

EmpiresX’s Website Displayed Fake Investor Account Balances 

56. For both the Exbot and private investors, Defendants used EmpiresX’s back 

office to materially and knowingly misrepresent the investors’ account balances. 

57. Those online accounts purportedly showed investors their daily profits and 

commissions earned, which led investors to believe they were making money from their 

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 12

investments and recruitment of other investors.  Such representations led investors to re-

invest their “profits,” thereby delaying the time when EmpiresX would have to pay 

investors their proceeds.  Various investors also invested fresh funds or recruited new 

investors based on the profits they believed were generated by their original investments.   

58. In fact, the investor account balances were fictional and EmpiresX stopped 

honoring investor withdrawal requests after November 2021.   

Defendants’ Lies About SEC Registration 

59. To make investors more comfortable with investing in EmpiresX, in Zoom 

meetings with investors, Defendants explained the importance of being a SEC-registered 

hedge fund.  Defendants told investors that EmpiresX filed to be a registered hedge fund 

with the SEC, and said EmpiresX received comments back from the SEC and was 

preparing documents for re-submission to the SEC.   

60. For example, on a September 9, 2021 Zoom call, Nicholas showed investors 

a “Prospectus” for a purported hedge fund controlled by Empires X, which would issue 

approximately 80 million shares at a price of $25 per share.  Nicholas stated that this 

Prospectus would be filed with the SEC as soon as EmpiresX reached $100 million in 

assets under management, which Nicholas suggested to investors would occur in the 

coming days. 

61. During that same presentation, Nicholas also showed investors contract 

documents that he claimed would be filed with the SEC.  Nicholas concluded the 

presentation by showing an official-looking SEC document – which was actually a SEC 

cease-and-desist order issued against an unrelated entity – and falsely stated that after the 

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SEC finished its review of EmpiresX’s paperwork, the SEC would issue a similar 

document “verifying everything that we already have created.”   

62. In an October 11, 2021 Zoom meeting with investors, Pires and Nicholas 

falsely told investors that EmpiresX had filed paperwork with the SEC, that the SEC 

provided feedback, and that EmpiresX had made a revised filing with the SEC.   

63. In an October 21, 2021 Zoom meeting with investors, Goncalves similarly 

lied by stating that EmpiresX made a revised filing with the SEC.  Goncalves added that he 

was “pretty sure” that EmpiresX would receive “SEC approval.”   

64. Nicholas also lied to investors about EmpiresX’s SEC registration status by 

directing them to the SEC filings of an unrelated company with a similar sounding name 

that contained the term “EmpireX.”  In particular, in the October 11, 2021 Zoom meeting, 

Nicholas told investors that they could check the status of EmpiresX’s filing with the SEC 

by going to sec.gov, searching for “EmpiresX,” and see the paperwork EmpiresX had filed.   

65. After learning that EmpiresX was improperly directing investors to its SEC 

filings, the true filer with a similar name issued a press release that “den[ied] the 

statements of the … company ‘EmpiresX’ which has been illegally using our Name, 

Address, and Financial License from the United States to deceive people worldwide with 

fraudulent investment operations.” 

66. Defendants’ statements about filings, registrations, and communications 

with the SEC were knowingly or recklessly false and material.  The SEC never received 

any registration paperwork or filing from, and never provided feedback or suggestions to, 

EmpiresX.  

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Defendants’ Touted Nicholas’s Credentials Yet Concealed His Disciplinary History 

67. Similar to their lies about EmpiresX’s registration with the SEC, 

Defendants touted to investors Nicholas’s background, trading experience, and securities 

licenses, yet failed to disclose Nicholas’s disciplinary history.  Defendants’ knowingly or 

recklessly omitted this material information. 

68. As a result of his initial NFA suspension in September 2020, which the 

NFA extended for eight-years in April 2021, Nicholas could not trade or associate with any 

firm that traded futures, options, or commodities on behalf of investors.   

69. Nevertheless, in various recorded meetings with investors, Defendants 

represented that Nicholas was a licensed and registered trader.  But during those meetings 

Defendants failed to disclose Nicholas’s NFA suspension or that the suspension was based 

on allegations that Nicholas misappropriated client assets. 

70. For example, in the July 2, 2021 Zoom meeting with investors, Goncalves 

said that EmpiresX would display Nicholas’s license for investors to see and that without 

the license, EmpiresX would not be able to make “one single trade.”  Nicholas then 

navigated to the FINRA “Brokercheck” page of an unrelated registered trader at a 

prominent investment bank with a name similar to Nicholas’s.  The Brokercheck page 

Nicholas referenced to investors as being about him thus displayed information for a 

different trader with no disciplinary history and a variety of securities licenses.   

71. Only after online blogs publicized Nicholas’ disciplinary history, Nicholas 

acknowledged his NFA suspension in a July 30, 2021 Zoom meeting with investors.  

Nevertheless, in subsequent investor meetings, Defendants would continue to promote 

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Nicholas’s trading expertise without mentioning his suspension.  

Defendants’ Material Misrepresentations  
About Investors’ Ability to Withdraw Their Money 

 
72. To promote the investments and encourage investors to reinvest their 

“profits,” Defendants told investors and prospective investors that they could compound 

their interest and also easily withdraw their funds.   

73. For example, the PowerPoint Defendants showed to investors initially 

represented that investors could withdraw their profits either weekly (for Exbot investors) 

or monthly (for “private” investors), and withdraw their capital “anytime, any day.”  

74.  Similarly, in a July 30, 2021 Zoom meeting with investors, Goncalves 

represented that investors could withdraw their funds “whenever you want.”  

75. Having been told they could easily withdraw their money, most investors 

decided to reinvest their purported profits.  

76. To further discourage withdrawals, EmpiresX charged fees including a 20% 

fee for any withdrawals made within the first month of investing, which decreased to 0.5% 

for subsequent months.   

77. In October 2021, without any notice to investors, Defendants changed the 

rules for Exbot investors to withdraw their profits, from weekly to monthly.  Additionally, 

EmpiresX increased the withdrawal fees for both Exbot and private investors, such that the 

fee increased to 40% for withdrawals made within the first month of investing, 20% for 

withdrawals made within 60 days of investing, and 10% for withdrawals made within 90 

days of investing.   

 

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78. EmpiresX also instituted a new rule that investors could only withdraw their 

capital three times and thereafter, their accounts were closed.  These higher fees caused 

some investors to wait several months before requesting to withdraw funds from their 

accounts.  Investors who invested prior to October 2021 invested without having notice of 

these material changes to the withdrawal rules and fees.   

Defendants’ Misuse of Investor Funds 

79. Between November 2020 and December 2021, EmpiresX received at least 

$40 million in investor funds. 

80. Despite Defendants’ representations that investors’ money would be 

deployed for trading, of this amount, Defendants only transferred approximately $1 million 

of investors’ funds to EmpiresX’s account at Brokerage Firm B.   

81. Therefore, rather than use investors’ funds for trading, Defendants 

misappropriated a large amount of the money received from investors.  

82. For instance, Pires diverted investor funds for personal expenditures 

including the following:  $300,000 in travel expenses, $250,000 in home renovations, 

$125,000 for a down payment on another home, $70,000 for the lease down payment for a 

Lamborghini Urus, $47,000 in apparel, $33,000 in meals and groceries, $19,000 in 

mortgage payments, and $15,000 in home décor.  Pires also paid nearly $358,000 to 

another company he manages, and transferred over $250,000 to himself, relatives, and 

associates. 

83. For his part, Goncalves received at least $421,000 of investor funds, and his 

relatives received at least an additional $99,000.  Goncalves used the investor money for 

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personal uses including the following:  $69,000 at luxury hotels, $43,285 in lease 

payments for a Ferrari 488 GTB, $7,000 to Jaguar Land Rover, $3,000 to Tiffany & Co., 

and on other personal expenditures, including grocery shopping and a gym membership. 

84. In less than one year, between May 2021 and April 2022, Nicholas received 

at least $289,000 of investor funds, which he likewise spent on personal uses.  

Defendants’ Scheme Collapses 

85. By approximately November 2021, EmpiresX stopped honoring investor 

withdrawals, providing investors with the fake excuse that it had to process withdrawals 

manually rather than automatically due to technical difficulties at its crypto trading firm.   

86. Then, in January 2022, blaming unspecified “deleterious acts” and 

unidentified “stakeholders [who] have violated standards and acted in ways that purport to 

harm the company,” EmpiresX stated in a written announcement to investors that it would 

repay all investor funds and dissolve by the end of February 2022.   

87. This promise of repayment was false.  Since November 2021, EmpiresX has 

failed to honor withdrawal requests or otherwise repay its defrauded investors.   

88. In the meantime, after receiving subpoenas as part of the SEC’s 

investigation, Pires and Goncalves began winding down EmpiresX’s operations in the 

United States.  On information and belief, they have relocated to Brazil, where they are 

both citizens. 

COUNT I 

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

89. Paragraphs 1 through 88 are realleged and incorporated by reference. 

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90. At all times alleged in this Complaint, no registration statement was filed or 

in effect with the SEC pursuant to the Securities Act with respect to the securities and 

transactions issued by EmpiresX described in this Complaint, and no exemption from 

registration existed with respect to these securities and transactions. 

91. By their conduct, Defendants EmpiresX, Pires, Goncalves, and Nicholas, 

directly and indirectly: 

(a) made use of any means or instruments of transportation or 
communication in interstate commerce or of the mails to sell 
securities, through the use or medium of a prospectus or otherwise; 

(b) carried or caused to be carried securities through the mails or in 
interstate commerce, by any means or instruments of transportation, 
for the purpose of sale or delivery after sale; or 

(c) made use of any means or instruments of transportation or 
communication in interstate commerce or of the mails to offer to 
sell or offer to buy through the use or medium of any prospectus or 
otherwise any security, 

without a registration statement having been filed or being in effect with the SEC as to 

such securities. 

92. By reason of the foregoing, Defendants EmpiresX, Pires, Goncalves, and 

Nicholas violated and, unless enjoined, are reasonably likely to continue to violate 

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

COUNT II 

Violations of Section 17(a)(1) of the Securities Act  
(Against All Defendants) 

93. Paragraphs 1 through 88 are realleged and incorporated by reference as 

though fully set forth herein. 

 

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94. By engaging in the conduct described above, Defendants EmpiresX, Pires, 

Goncalves, and Nicholas, in the offer and sale of securities, by the use of the means and 

instruments of transportation or communication in interstate commerce or by use of the 

mails, directly or indirectly, have employed devices, schemes and artifices to defraud.  

95. Defendants acted knowingly or recklessly in engaging in the fraudulent 

conduct described above. 

96. By engaging in the conduct described above, Defendants violated Section 

17(a)(1) of the Securities Act [15 U.S.C. § 77q(a)(1)] in the manner set forth above. 

COUNT III 

Violations of Section 17(a)(2) of the Securities Act  
(Against All Defendants) 

97. Paragraphs 1 through 88 are realleged and incorporated by reference as 

though fully set forth herein. 

98. By engaging in the conduct described above, Defendants EmpiresX, Pires, 

Goncalves, and Nicholas, in the offer and sale of securities, by the use of the means and 

instruments of transportation or communication in interstate commerce or by use of the 

mails, directly or indirectly, have obtained money and property by means of untrue 

statements of material fact and by omitting to state material facts necessary to make the 

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

misleading.  

99. Defendants acted knowingly or recklessly in engaging in the fraudulent 

conduct described above. 

100. Defendants also acted negligently in engaging in the conduct described 

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above. 

101. By engaging in the conduct described above, Defendants violated Section 

17(a)(2) of the Securities Act [15 U.S.C. § 77q(a)(2)] in the manner set forth above. 

COUNT IV 

Violations of Section 17(a)(3) of the Securities Act  
(Against All Defendants) 

102. Paragraphs 1 through 88 are realleged and incorporated by reference as 

though fully set forth herein. 

103. By engaging in the conduct described above, Defendants EmpiresX, Pires, 

Goncalves, and Nicholas, in the offer and sale of securities, by the use of the means and 

instruments of transportation or communication in interstate commerce or by use of the 

mails, directly or indirectly, have engaged in transactions, practices, and courses of 

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

securities.  

104. Defendants acted knowingly or recklessly in engaging in the fraudulent 

conduct described above. 

105. Defendants also acted negligently in engaging in the conduct described 

above. 

106. By engaging in the conduct described above, Defendants violated Section 

17(a)(3) of the Securities Act [15 U.S.C. § 77q(a)(3)] in the manner set forth above. 

COUNT V 

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

107. Paragraphs 1 through 88 are realleged and incorporated by reference. 

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108. As more fully described in paragraphs 1 through 88 above, Defendants 

EmpiresX, Pires, Goncalves, and Nicholas, in connection with the purchase and sale of 

securities, by the use of the means and instrumentalities of interstate commerce and by the 

use of the mails, directly and indirectly, used and employed devices, schemes and artifices 

to defraud. 

109. Defendants knew, or were reckless in not knowing, of the facts and 

circumstances described in paragraphs 1 through 88 above. 

110. By reason of the foregoing, Defendants violated Section 10(b) of the 

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

in the manner set forth above. 

COUNT VI 

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

111. Paragraphs 1 through 88 are realleged and incorporated by reference. 

112. As more fully described in paragraphs 1 through 88 above, Defendants 

EmpiresX, Pires, Goncalves, and Nicholas, in connection with the purchase and sale of 

securities, by the use of the means and instrumentalities of interstate commerce and by the 

use of the mails, directly and indirectly, made untrue statements of material fact and 

omitted to state material facts necessary in order to make the statements made, in light of 

the circumstances under which they were made, not misleading. 

113. Defendants knew, or were reckless in not knowing, of the facts and 

circumstances described in paragraphs 1 through 88 above. 

114. By reason of the foregoing, Defendants violated Section 10(b) of the 

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

in the manner set forth above. 

COUNT VII 

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

115. Paragraphs 1 through 88 are realleged and incorporated by reference. 

116. As more fully described in paragraphs 1 through 88 above, Defendants 

EmpiresX, Pires, Goncalves, and Nicholas, in connection with the purchase and sale of 

securities, by the use of the means and instrumentalities of interstate commerce and by the 

use of the mails, directly and indirectly, engaged in acts, practices and courses of business 

which operated or would have operated as a fraud and deceit upon purchasers and sellers 

and prospective purchasers and sellers of securities. 

117. Defendants knew, or were reckless in not knowing, of the facts and 

circumstances described in paragraphs 1 through 88 above. 

118. By reason of the foregoing, Defendants violated Section 10(b) of the 

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

in the manner set forth above. 

RELIEF REQUESTED 

 WHEREFORE, the SEC respectfully requests that this Court: 

I.  

 Issue permanent injunctions restraining and enjoining Defendants from violating 

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

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

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CFR § 240.10b-5]; and from soliciting any new investors, accepting additional funds from 

existing investors, or issuing, purchasing, offering, or selling any security. 

II. 

Order Defendants EmpiresX, Pires and Goncalves to disgorge, jointly and 

severally, and Nicholas to disgorge, the ill-gotten gains received because of the violations 

alleged herein, including prejudgment interest, pursuant to Sections 21(d)(5) and 21(d)(7) 

of the Exchange Act [15 U.S.C. §§ 78u(d)(5) and 78u(d)(7)]. 

III. 

Order Defendants to pay civil 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)].  

IV. 

 Permanently bar defendants Pires and Goncalves from serving as an officer or 

director of any company 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)], pursuant to Section 21(d)(2) of the 

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

V. 

 Grant such other relief as this Court deems appropriate. 

JURY DEMAND 

 The SEC hereby requests a trial by jury.  

 

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UNITED STATES SECURITIES AND 
EXCHANGE COMMISSION  
 

Date: June 30, 2022 
  /s/ Benjamin J. Hanauer           _ 
By: Benjamin J. Hanauer 
      One of Its Attorneys  

 
Benjamin J. Hanauer 
Senior Trial Counsel  
S.D. Fla. No. A5502908 
Direct Dial: (312) 353-8642 
Email: [email protected] 
 
Christine B. Jeon  
S.D. Fla. No. A5502884 
Senior Counsel  
Direct Dial: (312) 353-7419 
Email: [email protected]  
 
Devlin Su 
Senior Counsel  
S.D. Fla. No. A5502883 
Direct Dial: (312) 596-6012 
Email: [email protected]  
 
Attorneys for Plaintiff 
UNITED STATES SECURITIES  
  AND EXCHANGE COMMISSION  
175 W. Jackson Blvd., Suite 1450 
Chicago, Illinois 60604 
Tel: (312) 353-7390 
 

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