California tech CEO busted in international $2M smart ring Ponzi scheme | Latest Tech News
A wearable tech company’s boss will spend many years in prison for working a near-$2 million Ponzi scheme, duping traders with fabricated patent possession, and fraudulently acquiring a federal business-relief loan during the pandemic.
Michelle Bisnoff, CEO of Esos Rings Inc., started the scheme in 2017 by claiming possession of patented near-field communication (NFC) cost rings that truly belonged to McLear Ltd., a UK-based company that had employed her to develop its US market, the US Attorney’s Office said Friday.
She solicited money by telling traders the funds would enhance manufacturing and construct stock to meet high demand from major retailers like Target and Walmart, authorities said.
Esos CEO Michelle Bisnoff was convicted of working a practically $2 million Ponzi scheme utilizing stolen smart ring patents. Department of Justice
Esos had no agreements with Target, had generated little or no income, and had bought just six rings through Walmart. Department of Justice
In actuality, Esos had no agreements with Target, had generated little or no income, and had bought just six rings through Walmart, three of which have been returned by clients.
She also falsely claimed that Apple Inc. and Roc Nation have been investing in the company, though Esos had no offers with either entity.
When Bisnoff failed to ship promised returns, she provided what an investor at her seven-day trial described as “dog-ate-my-homework” excuses.
She then tried to embezzle roughly $550,000 from an employer to pay back traders, but those checks bounced. In whole, Bisnoff defrauded traders out of practically $2 million, inflicting roughly $1.4 million in direct losses.
Alongside the investment fraud, Bisnoff illegally utilized for federal COVID-19 aid through the Economic Injury Disaster Loan (EIDL) program in March 2020. After receiving a $150,000 loan, she funneled half of the funds into her personal lifestyle, including a $15,600 month-to-month rent cost on a leased home in Pacific Palisades.
Bisnoff claimed the patent for the near-field communication cost rings that belonged to McLear Ltd., a UK company. Department of Justice
Back in 2023, the SEC had sued Bisnoff and her company for ripping off traders to the tune of $1.95 million. Later that yr, a court ordered them to cough up over $836,000 in 20 days. But according to court information, neither Bisnoff nor Esos has paid back a single dime.
US District Judge Mónica Ramírez Almadani has scheduled a Jan. 21, 2027, sentencing listening to following Bisnoff’s conviction on a number of fraud, money laundering and id theft prices.
Each depend of securities fraud and wire fraud carries a statutory most penalty of 20 years in federal prison, while each money laundering charge carries up to 10 years.
Additionally, the aggravated id theft counts carry a obligatory two-year federal prison sentence that must be served consecutively to any other time period imposed.
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