Two California men were charged with defrauding more than 150 mostly retail investors out of more than $80M by operating a Ponzi-like scheme.

Mark Hanf, 65, and Hoai-Nam Chu Phan, 58, were charged in separate but parallel cases from the U.S. Securities and Exchange Commission and the U.S. Attorney’s Office for the Northern District of California. 

The duo is accused of using new investor capital to pay redemption requests at two funds. The fundraising began in 2013 and ran through 2025, when the scheme unraveled and the two funds filed for Chapter 11 bankruptcy protection.

“Despite total outstanding investments in the two private funds of almost $121 million, by February 2026 the total recoverable assets of those funds were estimated to be less than $17 million. That amounts to devastating losses for so many investors,” Jason Lee, associate director of the SEC’s San Francisco regional office, said in a statement Wednesday. 

Novato, California-based Pacific Private Money Group LLC was operated by Hanf and Phan and launched the two funds. Starting in 2021, Hanf and Phan raised $103M from more than 175 investors, prosecutors alleged in a California court.

The information filing from prosecutors is a step short of an indictment and often signals that the accused parties have reached some kind of deal. 

In the SEC case, Hanf and Phan have agreed not to participate “in the issuance, purchase, offer, or sale of any security, except for purchases or sales for their own personal accounts” without admitting any wrongdoing. The judgment still needs a judge’s approval.

The two were charged with misrepresenting the funds’ liquidity and status to investors, many of whom are retired seniors, and continuing to raise capital even after discovering their investments were likely to default. 

The funds’ largest developer died in 2021, and Hanf and Phan learned that its loans were nonperforming, with many backed by distressed assets that were unlikely to fully cover the debt, according to the U.S. attorney’s complaint. By the end of 2021, the pair was shuffling funds between accounts to cover redemption requests and eventually began cycling new investor capital back to old investors looking to cash out. 

Hanf is also accused of misappropriating more than $7M in investor capital for his personal benefit, including to service his own debt, fund a boxing match and invest in a cryptocurrency venture, the SEC complaint alleges.  

By the fall of 2025, the two funds were running out of money. 

“At this time, Hanf and Phan maintained a spreadsheet of outstanding investor redemption requests. Whenever the Pacific Fund or the Freedom Fund took in new investor capital, internal discussions, at times including Hanf and Phan, ensued about which outstanding redemptions or distributions this new capital should be spent on, including prioritizing redemptions for investors most likely to complain,” the SEC complaint alleges. 

The two funds, named the Pacific Fund and the Freedom Fund, filed for bankruptcy on June 16, 2026.