SEC Uncovers Massive Fraud Scheme Behind Dan Bilzerian’s Ignite Brands
The U.S. Securities and Exchange Commission has filed charges against Ignite International Brands (CSE: BILZ), its financier Paul Bilzerian, and several other executives in connection with an alleged scheme to falsify financial records in 2020.
The lawsuit exposes the practices of a company led by Dan Bilzerian, a social media personality, and his father, Paul Bilzerian—a figure with a past of securities fraud and financial misconduct. The suit reveals a scheme involving fraudulent invoices, manipulation of financial records, and misleading investors about the financial health of Ignite.
According to the SEC complaint filed in the U.S. District Court for the Southern District of New York on September 27, 2024, Ignite International Brands, a company involved in distributing vape pens and nicotine products, was involved in a scheme to report false revenue. The fraudulent activity was said to have been orchestrated by Paul Bilzerian, who effectively controlled Ignite’s finances and operations.
From late 2020 through early 2021, Ignite issued several false invoices to a customer identified as “Company 1” in the complaint. These invoices, totaling around $5 million, were for products that Company 1 had neither ordered nor taken possession of.
Despite receiving objections from the customer disputing these invoices, Ignite continued to present them as legitimate sales. On January 19, 2021, Ignite issued a press release claiming that their fourth-quarter revenue had exceeded the previous three quarters combined, which allegedly caused a 144% rise in its share price on the OTC in the United States.
When the SEC began its investigation, Ignite faced difficulty during an audit carried out by Accell Audit & Compliance, PA, who sought to confirm the accounts receivable connected to the invoices. Company 1, the recipient of the false invoices, refused to validate them.
In response, Paul Bilzerian shifted the alleged responsibility for the purchase to International Investments Ltd., a company also under his control, retroactively backdating the transactions to December 2020. The SEC alleges that the scheme was created to cover up Ignite’s non-existent sales, making it appear as if they had a profitable quarter.
Furthermore, the SEC accuses Bilzerian, Ignite’s then-Chief Financial Officer Paul Dowdall, and Deputy Scott Rohleder of creating and promoting a false narrative to the auditors about the supposed purchase of the vape pens by International Investments. The auditors from Accell, specifically the engagement partner Christopher Hiestand, failed to properly scrutinize the discrepancies, thereby facilitating Ignite’s fraudulent scheme to report the false revenue as legitimate.
Paul Bilzerian, a recidivist in securities fraud, has a history of financial misconduct dating back to the 1980s. Previously convicted of securities fraud and conspiracy to defraud the U.S., Bilzerian has spent decades litigating over financial penalties and was once sentenced to four years in prison. The SEC’s current case against him indicates that his role within Ignite was not simply advisory but that he had significant influence and control over the company’s operations.
His son, Dan Bilzerian, known widely for his social media fame and lavish lifestyle, is Ignite’s Chief Executive Officer. The younger Bilzerian founded Ignite in 2017, and while not directly implicated in the SEC’s current charges, the company’s financial troubles and legal issues raise questions about his business practices and leadership.
The SEC is seeking permanent injunctive relief to prevent future violations, civil penalties, and officer and director bars against the key individuals involved in the scheme. In a parallel action, the Department of Justice’s Fraud Section and the U.S. Attorney’s Office for the Central District of California announced criminal charges against Ignite, Bilzerian, and Rohleder.
Information for this briefing was found via the sources mentioned. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
