Paul A. Bilzerian was indicted Thursday by a federal grand jury in California for allegedly dodging a decades-old judgment owed to the U.S. Securities and Exchange Commission that now exceeds $180 million.
Prosecutors say Bilzerian, described as a specialist in corporate buyouts, avoided paying the judgment even as he ran Ignite, a cannabis and lifestyle brand company allegedly run by his social media influencer son , Dan Bilzerian.
The elder Bilzerian allegedly funneled millions of dollars of his assets through shell companies to finance Ignite, whose investors he allegedly misled, the Justice Department said Friday.
“On paper, Ignite’s CEO was Bilzerian’s son DB, a professional poker player who gained notoriety on social media through his glamorous and ostentatious lifestyle,” the U.S. Attorney’s Office said of Los Angeles in a press release. “In effect, Bilzerian exercised de facto control over the company.”
To avoid paying the SEC judgments, prosecutors say, Bilzerian falsely represented that he was indigent.
The indictment charges Bilzerian, 74; Ignite International Brands, a Canadian-based cannabis company; and Scott Rohleder, Bilzerian’s longtime accountant, for conspiracy to defraud the United States, conspiracy to commit wire fraud and securities fraud, and four counts of wire fraud.
The younger Bilzerian has not been charged and is identified only by his initials in the indictment.
Lawyers for the defendants could not immediately be reached for comment. The arraignment is scheduled for October 28.
“This indictment alleges long-standing criminal conduct designed to avoid the judgment of a regulator, mislead investors, and deceive the IRS,” said US Atty. Martin Estrada said in a statement.
The last charges date back to 1989, when Bilzerian was convicted of securities violations and tax fraud related to three failed buyout attempts. He was sentenced to four years in federal prison, but ultimately served 13 months.
The SEC then filed a civil suit against Bilzerian and obtained judgments totaling more than $62 million in 1993. Since then, prosecutors say, Bilzerian has evaded prosecution.
In 2000, a federal court found Bilzerian in contempt and appointed a receiver to recover his assets, according to the U.S. attorney’s office in Los Angeles. The SEC only recovered about $547,000.
Now, with interest, the judgments exceed $180 million.
Prosecutors allege that from December 2018 through September 2024, Bilzerian, Rohleder and Ignite conspired to prevent the SEC from collecting judgments. Bilzerian allegedly operated numerous shell companies, while concealing his interests and control over these companies.
Bilzerian and Rohleder allegedly oversaw Ignite’s operations, strategy, marketing and fundraising, and held daily management meetings, according to the indictment. Bilzerian also had influence over the hiring and firing decisions of Ignite’s executives and members of its board of directors.
After Bilzerian learned that federal law enforcement was aware of his involvement in Ignite, the company issued a press release calling Bilzerian and Rohleder “unpaid consultants,” according to the indictment.
Prosecutors also say the defendants misled Ignite investors by inflating sales figures.
If convicted of all charges, Bilzerian and Rohleder face up to five years in federal prison for each conspiracy count and up to 20 years for each wire fraud count. Rohleder would face up to three years for each tax fraud count.
On Friday, the SEC filed civil charges against Bilzerian, Rohleder and Ignite in connection with the facts alleged in the criminal case.
