Some investors believed that struggling retail brands like RadioShack, Pier 1 Imports, and Dressbarn could still be revived. Others were drawn in by a YouTuber who once went viral sharing get-rich advice from the Lamborghini-filled garage of his Beverly Hills home.
The Wall Street Journal examines Taino “Tai” Lopez, who, along with a partner, now faces accusations of running a large Ponzi-style scheme. Known for his “here in my garage” videos and online courses promising financial success, Lopez raised more than $230 million from hundreds of mostly small investors. The money was meant to help acquire faded retail chains and transform them into thriving online businesses.
According to a civil lawsuit filed by the Securities and Exchange Commission, roughly $112 million of those funds came from fraudulent securities offerings. Investor payments were allegedly made using money from new backers rather than business profits. Former employees told the Journal that none of the acquired retailers were profitable, and funds were reportedly moved between brands to plug financial gaps.
Investor payouts stopped in late 2022, and many people reportedly lost six-figure sums. The FBI is now conducting a criminal investigation. Lopez has not publicly addressed the collapse.
The Journal’s report also looks into Lopez’s background, including his early success in sales, his skill at writing Google ads, and his efforts to network with influencers and business figures such as Mark Cuban, who appeared in a 2015 video with Lopez and has since said he was reluctant to participate.
For a deeper look, including internal messages and accounts from investors, see the full investigation by Suzanne Kapner and Alexander Gladstone in The Wall Street Journal.