SEC Sues Florida Litigation Funder Over Mass Tort Investor Scam

The Securities and Exchange Commission is accusing two Florida men of defrauding investors out of $125,000 in a litigation finance scheme.

The agency on Friday sued Michael Chhabra and his father, Vineet “Vincent” Chhabra, in a federal court in Washington. SEC lawyers say the pair used money invested in their supposed litigation finance company as a personal slush fund.

The Chhabras promised investors returns and interest from lending money to law firms to finance mass tort litigation, according to the SEC. They allegedly used the funds instead for personal expenses, like rent, food, and travel, and to pay off debts ...