SEC Charges Never Alone Capital Founder Alan Burak in $4M Fraud Scheme

The Securities and Exchange Commission (SEC) has charged Alan Burak, founder of Never Alone Capital LLC, with running a fraudulent scheme that defrauded investors of approximately $4 million. According to the SEC, Burak misappropriated most of the funds for personal expenses, including luxury skincare and adult-only subscription services.

According to the SEC's lawsuit, from 2018 to 2023, Burak misled at least 17 investors into his alleged investment fund by portraying himself as a wealthy hedge fund magnate. He told them that their money would be channeled into “Wall Street” via a clever plan, even guaranteeing returns in some cases. Many of these investors spoke Spanish, and he met them through a financial education organization geared toward the Latino population.

However, the reality differed significantly from what Burak claimed. The SEC claims that instead of investing the $4 million as promised, he diverted the majority of it for personal expenses. This includes charging credit cards for expensive skin care goods and adult-only memberships. Burak is accused of supporting an opulent lifestyle at the cost of his clients, rather than developing money for them.

To maintain the façade, Burak allegedly provided investors with forged account statements showing consistent increases. In fact, their assets were losing value. Burak's fraud broke when he stopped communicating with investors. In a damaging audio recording dated July 2022, he admitted to being a fraud, saying, “I was fake,” and that he had no legal business—only a plot to steal money from others.

The SEC filed a case in the United States District Court for the Southern District of New York, accusing Burak of violating federal securities laws' antifraud provisions. They are requesting permanent injunctions, return of looted cash with interest, civil fines, and limits on his future behavior to avoid additional injury.

Adding to Burak's difficulties, the New York County District Attorney's Office has filed a criminal case against him, indicating a two-pronged legal attack on his alleged misbehavior.

This case offers a sharp reminder of the perils that exist in the financial industry, particularly when promises of fortune are made by someone like Burak, who reportedly preyed on confidence to fuel his fraudulent scam. For the impacted investors, the aftermath is a painful lesson in due diligence, while regulators seek to hold Burak accountable for the devastation he has caused.