SEC charges Pacific Private Money Group executives with $80 million fraud
Former CEO Mark D. Hanf and former COO Hoai-Nam Chu Phan face permanent injunctions and potential penalties for misrepresenting two private funds to about 190 investors.
The Securities and Exchange Commission filed a complaint in the U.S. District Court for the Northern District of California alleging that Mark D. Hanf, former chief executive of Pacific Private Money Group LLC, and Hoai-Nam Chu Phan, former chief operating officer of a PPMG subsidiary, conducted an offering fraud that raised more than $80 million from approximately 190 investors, many of whom were retired senior citizens. The complaint says the defendants misrepresented that capital would be used to originate or purchase loans secured by real-estate and that investors could expect preferred or fixed rates of return.
From roughly December 2021 through November 2025, the SEC alleges Hanf and Phan used new investor money to make Ponzi-like payments to earlier investors and that the returns touted were not derived from any real-estate lending earnings. The agency further alleges Hanf misappropriated more than $7 million of investor funds for personal benefit. By February 2026, total outstanding investments in the two private funds were almost $121 million, yet recoverable assets were estimated at less than $17 million.
The complaint charges Hanf with violations of Section 17(a) of the Securities Act of 1933 and Section 10(b) of the Exchange Act of 1934, together with Rule 10b-5, and charges Phan with violations of Sections 17(a)(1) and (3) of the Securities Act and Section 10(b) of the Exchange Act and Rule 10b-5. Both defendants consented to the entry of a judgment that, subject to court approval, will permanently enjoin them from violating the charged provisions and from participating in any securities offering, purchase, or sale, except for transactions in their own personal accounts.
In a parallel action, the U.S. Attorney's Office for the Northern District of California announced criminal charges against Hanf and Phan. The SEC's complaint does not include a determination of disgorgement, prejudgment interest, or civil penalties, which the Commission may seek in a later motion.
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