DJ Envy Federal fraud charges

Photo Credit: Matt Donders

Federal agents arrested a man in New Jersey for operating a Ponzi scheme disguised as a house-flipping business. The business was promoted by radio rapper DJ Envy.

Feds arrested Cesar Humberto Pina, who was often promoted on DJ Envy’s syndicated iHeartRadio show ‘The Breakfast Club.’ The 45-year-old is charged with one count of wire fraud.

“As alleged in the complaint, Pina exploited celebrity status and social media to develop a devoted following of potential victims,” shares U.S. Attorney Philip R. Sellinger. “Promising returns that were too good to be true, Pina allegedly defrauded dozens of people out of millions of dollars. Our office is committed to protecting the public from these schemes and prosecuting those who lie to investors for their own personal gain.”

According to investigators, Pina solicited dozens of individuals to purchase and invest in residential properties. He falsely represented the nature of the business and lied to investors about potential returns.

“We allege Pina offered a ridiculously high rate of return to investors, then took the millions he got and invested it in himself,” adds FBI Newark Special Agent in Charge James E. Dennehy. “HIstory has proven time and again, Ponzi schemes don’t work. The pot of gold at the end of the rainbow eventually runs out.”

Pina partnered with DJ Envy to conduct real estate seminars around the country as self-promotional efforts. Through those efforts, he developed a significant social media following. In 2017, he began accepting investments for the alleged purchase, remodel, and sale of real estate projects around New Jersey and other states. Pina promised investors a 20% to 45% return on their investment within five months.

“Instead of using victims’ investments as promised, Pina engaged in a Ponzi-like scheme by commingling victim money, using new victim investments to pay off prior victims, and spending victim funds on personal expenditures. The investigation reveals Pina defrauded dozens of investors of millions of dollars,” the statement reads.

The charge of wire fraud carries a maximum penalty of 20 years in prison and a fine of $250,000—or twice the gross amount of any pecuniary gain or pecuniary loss sustained by victims of the offense.