Boiler Room Boss Charged Over $74 Million Fake Pre-IPO Scam

Andrew Spaventa and three companies he owned are charged by the SEC with running a boiler room that sold fake bargains in pre-IPO shares to more than 800 mostly retail investors, and pocketed the difference. [S1]

PROOF

The SEC filed its complaint against Spaventa, The Spaventa Group LLC, TSG Capital Advisors LLC, and TSG Alpha Partners LLC in the U.S. District Court for the Southern District of New York, announced Aug. 14, 2026. [S1] The complaint says that between approximately December 2020 and June 2025, Spaventa and his entities raised more than $74 million from more than 800 mostly retail investors across the United States for eleven private funds. [S1] Through entities he owned, Spaventa purchased the pre-IPO shares, either directly or through another investment fund, and then sold them in principal transactions to his funds at marked-up prices. [S1] Those markups were then passed on to investors in the form of hidden fees charged on the sale of membership interests in the funds. [S1] The complaint alleges Spaventa and his entities solicited these investments using over 100 "sales agents" to cold call and pitch the funds to thousands of prospective investors, many of them retirees, using high-pressure sales tactics. [S1] The defendants falsely told investors that they would pay either no upfront fees at all or upfront fees of at most 12.5%, when in reality, the prices investors paid were on average approximately 46% higher than the prices Spaventa paid for the investments. [S1] The complaint says the defendants collected approximately $23 million in upfront fees from unsuspecting investors, of which more than $12 million was funneled to their sales agents for commissions and approximately $4 million went to Spaventa personally. [S1] The complaint charges the defendants with violating the antifraud, securities registration, and broker-dealer registration provisions of the Securities Act of 1933, the Securities Exchange Act of 1934, and the Investment Advisers Act of 1940, and charges Spaventa individually with control person liability and aiding and abetting violations. [S1] It seeks permanent injunctions, disgorgement of ill-gotten gains and prejudgment interest, and civil penalties from all the defendants, and conduct-based injunctions against Spaventa. [S1]

PUBLIC OPINION

Sheldon L. Pollock, Associate Director of the SEC's New York Regional Office, said "Unsolicited calls and high-pressure sales tactics are the calling cards of so-called boiler room operators. They get you on the phone and then hit you with the hidden fees." [S1] Pollock said the SEC encourages "investors to be vigilant when it comes to these types of tactics." [S1]

BULLSHIT DEFENSE

No response from Spaventa or any lawyer representing him appears in the sources. [S1]

Eight hundred people picked up the phone thinking they were getting a deal on shares before the IPO. Four million dollars of what came back went straight into Spaventa's own pocket. [S1]