Newport man charged in $13.5 million Ponzi case

A Newport Beach man is facing 197 felony charges on allegations that he defrauded investors and banks of more than $13.5 million through a Ponzi scheme.

Brandon Walton Stewart, 30, was extradited Thursday from Texas to Orange County, where he is charged with three counts of residential burglary, 24 counts of using untrue statements in the purchase or sale of a security, two counts of financial elder abuse, 126 counts of money laundering, 38 counts of writing checks with insufficient funds and four counts of failing to file a state tax return.


He also faces possible sentencing enhancements for aggravated white-collar crime in excess of $500,000, property damage over $3.2 million and money laundering in excess of $2.5 million.

If convicted, he could face a maximum sentence of 159 years and eight months in state prison and fines of more than $27 million.


U.S. marshals arrested Stewart on Oct. 8 in Dallas, but he fought extradition, according to a news release from the Orange County district attorney's office, Newport Beach Police Department and California Franchise Tax Board.

Authorities believe Stewart operated a Ponzi scheme between April 2009 and January 2013 that caused investors to lose more than $10.6 million.

He also is accused of defrauding banks by writing nearly $3 million in checks from closed accounts or accounts without sufficient funds between November 2012 and July 2014.

He is accused of not filing state tax returns from 2010 to 2013.


A Ponzi scheme is when investors are offered high short-term returns on investments, but instead of the investments generating income or legitimate profits, the investors' money is kept for the benefit of one person or is used to repay earlier investors.

Stewart allegedly told four investors, including a 92-year-old relative, that their money would be entered in a pool containing more than $100 million that would be invested in stocks, including Facebook and various foreign instruments.

Instead, authorities say, Stewart used the funds for personal expenses, such as flights to Las Vegas on a private jet and betting thousands of dollars in casinos.

He is accused of breaking into the home of two victims as part of his effort to carry out the scheme.

Stewart is expected to be arraigned Monday at the Central Jail in Santa Ana. Prosecutors are requesting that his bail be set at $13.5 million and that he be ordered to prove the money is from a legal source before he can post bond.