Santa Barbara Man Charged in $12M Ponzi Scheme Now Faces Tax Offenses

Source: Department of Justice

A Santa Barbara man who allegedly stole approximately $12 million from victims who thought their investments would be used to purchase annuities today faces new charges of failing to pay over $3 million in federal income tax and concealing bank accounts in Monaco used to hide ill-gotten gains.

A superseding indictment filed today in United States District Court charges Darrell Arnold Aviss, 64, with three counts of tax evasion, six counts of failing to report foreign bank and financial accounts, and one count of aggravated identity theft.

Aviss was arrested last June and initially charged with five counts of wire fraud and six counts of money laundering for allegedly operating a Ponzi scheme that promised to invest victims’ money in annuities from Swiss insurance companies. The original 11 charges are included in today’s superseding indictment that alleges Aviss used none of the victim funds to purchase annuities.

Aviss, who was jailed for about three months before a judge ordered him released in September on a $200,000 bond, is currently scheduled to go on trial July 26. He will be directed to appear for an arraignment on the superseding indictment in the coming weeks.

Aviss allegedly operated the fraud scheme from at least 2012 through mid-2020, soliciting money from people who wanted to purchase annuities from insurance companies based in Switzerland. Even though he arranged for the victims to receive statements showing the value of the annuities were increasing, the indictment alleges Aviss did not use the victims’ money to purchase annuities. Victims, most of whom were over the age of 60, gave Aviss more than $12 million, with most of that money coming from just one victim, according to court documents. Some money was paid back to victims to keep the scheme running.

Instead of purchasing annuities, Aviss allegedly used the victims’ money for his own purposes and to support his lavish lifestyle, which included luxury cars, expensive watches and trips to Monaco.

The superseding indictment alleges that Aviss also defrauded the United States by failing to file tax returns for 2014, 2015 and 2016 and failing to pay any income taxes for those years. Aviss allegedly evaded paying more than $3 million in income taxes.

Aviss also failed to file with the Department of the Treasury Reports of Foreign Bank and Financial Accounts for the years 2015 through 2020 relating to accounts he controlled in Monaco. The superseding indictment alleges that he transferred victims’ money to these offshore accounts, one of which was established with information from an identity theft victim.

An indictment contains allegations that a defendant has committed a crime. Every defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.

If convicted of the charges in the superseding indictment, Aviss would face decades in federal prison. For example, each of the five counts of wire fraud carries a statutory maximum sentence of 20 years in federal prison.

The FBI and IRS Criminal Investigation are conducting the investigation in this matter.

Assistant United States Attorney Monica E. Tait of the Major Frauds Section is prosecuting this case.