The Securities and Exchange Commission is dropping the hammer on private fund advisers who allegedly mishandled millions in investor assets under the guise of granting them lucrative pre-IPO shares in coveted startups such as OpenAI, SpaceX, and others.
According to two separate cases announced on Wednesday, the SEC claims multiple fund advisers allegedly deceived mom-and-pop investors—including Navy veterans—about where the millions they thought they invested actually went. One adviser raised money for funds meant to hold OpenAI and SpaceX shares, while the other pair pitched investors on SandboxAQ and Kraken while falsely claiming to hold stakes in SpaceX and xAI. None of the actual companies or the executives who lead them are alleged to have engaged in wrongdoing.
The SEC has brought a series of charges related to pre-IPO stakes, misappropriated investor funds, and hidden fees in recent months, following SpaceX’s blockbuster $1.8 trillion IPO in June. Other recent charges have alleged that hundreds of investors were lured in by claims private fund advisers could grant them access to companies including Anduril, Anthropic, Perplexity, and others as valuations have skyrocketed.
In an eye-popping case announced on Wednesday the SEC sued Owen Meyer, 35, and his firm, Meyer Global Management in federal Court in Manhattan, alleging Meyer raised at least $18.5 million from nearly 100 investors while misappropriating at least $1.27 million in client money along the way. What’s more, the SEC claims Meyer spent more than $18,000 in fund capital for his “personal entertainment” at a strip club one night in April 2023 that spilled into the wee hours of the morning.
Meyer allegedly tried to pay a $4,400 bill to the club at 4:41 a.m. using a debit card associated with Meyer Global Partners, but it was declined twice, the SEC claims. Just minutes later, Meyer transferred $10,000 from a fund account containing only investor money to the Meyer Global Partners account. He then allegedly paid the club $4,400 at 4:44 a.m. and then another $3,650 at 5:30 a.m. for receipts that listed drinks, “entertainment room rental fees,” and included the name of Meyer’s cocktail server at the club, the SEC claims.
That same night, Meyer allegedly transferred $10,000 directly from the same fund account, which held investor money raised to buy shares of online casino operator Playstar. He transferred the money to the manager of the strip club, the SEC alleges. Memo lines on the payments listed “movie tickets and theatre performance,” and “opera.” The SEC claims the strip club manager testified that “Meyer visited the club alone, not with any business associates or friends, and that Meyer’s payments to him personally may have been because Meyer was having difficulties paying with his own credit card, or as gratuity to him as manager,” the complaint states.
When Meyer was asked by SEC staff about the $10,000 transfer from the fund account, Meyer invoked his Fifth Amendment rights against self-incrimination, the SEC said. Meyer did not respond to a request for comment. The SEC characterized it as an undisclosed “interest-free loan” because the Playstar investors eventually got their money back.
In a second case announced on Wednesday, the SEC and federal prosecutors charged former naval officer Christopher Dinelli, 34, and Jacob Frankel, 32, with allegedly defrauding 35 investors of more than $8.7 million through their firm, Beyond Alpha Ventures. Their marketing falsely listed SpaceX and xAI as holdings, the SEC claims, when the funds never held investments in those companies.
Authorities claim Dinelli and Frankel pitched investors on a trading fund with “153%” net returns plus pre-IPO stakes in crypto exchange Kraken, and AI software firm SandboxAQ, chaired by former Google CEO Eric Schmidt. None of the firms are alleged to have engaged in wrongdoing. The SEC claims the trading fund lost money in 13 of 14 months, and less than half the nearly $6 million raised for pre-IPO deals went into them. Much of the rest went into options trading that was later lost, the complaint states. The two allegedly sent fake statements to investors, including one that Dinelli allegedly “hand-delivered” to a Navy veteran couple saying their $750,000 investment had grown to $4.1 million.
The SEC says Dinelli allegedly misappropriated more than $1 million, including a $250,000 investment in a documentary film, and Frankel allegedly misappropriated more than $340,000, partly for trades in accounts he controlled and to pay his criminal defense lawyer.
In a telephone interview, Frankel denied the SEC’s allegations, calling them “completely false,” and said the “truth will come out in court.” Frankel said he terminated Dinelli “two years ago,” and blamed him for the allegations. The SEC’s complaint says Dinelli was Beyond Alpha Ventures’ chairman until July 2025.
Dinelli did not respond to a request for comment. Frankel was convicted in March 2026 of grand larceny and identity theft. The SEC claims Frankel hid that conviction from regulators in his required disclosures.
The Mechanics
In both cases, regulators allege the fund advisers marketed themselves as having access to stakes in high profile private companies. All are alleged to have sent investors fake account statements and communications claiming their investments were either safe and sound or growing rapidly.
In Meyer’s case, the SEC claims he set up 16 funds, each to buy stakes in one pre-IPO company, most often Elon Musk-led SpaceX, in addition to Sam Altman-led OpenAI, which remains private.
According to the SEC, Meyer set up a fund to invest in OpenAI, but never got any OpenAI shares. Meyer testified that a deal to acquire OpenAI assets fell through in March 2024, yet six investors wired nearly $1.1 million in April and weren’t told for about six months that there was no investment. The SEC claims Meyer paid himself about $168,000 in fees anyway, more than triple what investors agreed to, and some of it went to landscaping at his home in Setauket, New York. Only about $15,600 remains in the fund, the SEC stated.
As for his SpaceX funds, Meyer told investors in 2021 that a large purchase in SpaceX assets had closed even though the third-party fund that held the shares wouldn’t approve the transfer, the complaint states. Meyer wound up allegedly misappropriating about $570,000, including $100,000 for a personal investment in an exotic-car company and $220,000 sent to his personal bank account.
In 2025, when three other SpaceX funds were liquidated, Meyer allegedly moved about $636,000 meant for investors into his personal account. He allegedly spent thousands on shopping at Bloomingdale’s and Amazon, and allegedly sent $86,000 to his father, the complaint states. Another fund forfeited its entire SpaceX stake after Meyer allegedly failed to pay a capital call for $46,000, or answer a lawsuit, the complaint states. About $13.1 million was paid back to investors after the liquidation, the SEC noted.
The day of the June 12 SpaceX IPO, Meyer emailed his investors in his SpaceX funds, including the one that had lost its stake.
“This is a dream that many of us have followed for years, and today we have the opportunity to participate in what I believe will be one of the most important companies of our generation,” Meyer wrote, according to the complaint Meyer closed the note by telling them to “stay tuned” for updates on their distributions. The fund held no SpaceX shares to distribute, the SEC says. The SEC is seeking to bar Meyer from the industry, plus disgorgement and penalties.
In the second case, the SEC claims Navy vet Dinelli allegedly recruited fellow veterans and medical staff at a Veterans Affairs clinic in Pensacola, Fla., where he was a patient, the complaint states. Meanwhile, Frankel allegedly lost $2.8 million in margin trading in the fund’s brokerage account, including $1.9 million on a single options trade, the complaint states.
Prosecutors charged Dinelli and Frankel with securities fraud, wire fraud, and conspiracy. Frankel also faces investment adviser fraud and false-statement counts over SEC filings that allegedly concealed his conviction and a Finra suspension.
The Securities and Exchange Commission (SEC) has initiated significant legal actions against private fund advisers who allegedly mismanaged millions of investor assets, claiming to provide access to lucrative pre-initial public offering (IPO) shares in high-profile startups like OpenAI and SpaceX. These actions were announced in two separate cases on Wednesday, highlighting a trend of regulatory scrutiny over private fund advisers in the wake of a series of charges related to fraudulent investment activities.
In the first case, the SEC has filed a lawsuit against Owen Meyer, 35, and his firm, Meyer Global Management, in federal court in Manhattan. The SEC alleges that Meyer raised at least $18.5 million from nearly 100 investors but misappropriated approximately $1.27 million of client funds. Notably, Meyer is accused of diverting over $18,000 in fund assets for personal entertainment at a strip club, including payments made shortly after he transferred $10,000 from an investor fund to cover his tab. The SEC describes these transactions as an undisclosed “interest-free loan” since he later reimbursed the investors.
Meyer purportedly established 16 separate funds intended to invest in pre-IPO companies, including OpenAI and SpaceX. However, the SEC claims that Meyer never secured any actual shares from these companies. In one instance, he allegedly led investors to believe that a deal to acquire OpenAI shares was imminent, despite a collapsed deal in March 2024, leaving investors uninformed about the lack of investment for several months. During this time, Meyer reportedly paid himself exorbitant fees and misappropriated funds for personal expenditures, including shopping and landscaping for his home.
The SEC is seeking to bar Meyer from the investment industry and impose disgorgement and penalties due to these alleged violations.
In a second case, former naval officer Christopher Dinelli, 34, and Jacob Frankel, 32, have been charged with defrauding 35 investors of over $8.7 million through their firm, Beyond Alpha Ventures. They allegedly misled investors by falsely claiming that their funds held stakes in prominent firms like SpaceX and xAI. Instead, Dinelli and Frankel pitched a trading fund that purportedly offered 153% net returns along with access to pre-IPO stakes in companies like the cryptocurrency exchange Kraken and AI software firm SandboxAQ. However, the SEC contends that the fund experienced significant losses and that less than half of the capital raised for pre-IPO investments was actually allocated to such deals.
Dinelli and Frankel are accused of fabricating account statements, with Dinelli allegedly providing a false statement to a veteran couple indicating their investment had ballooned from $750,000 to $4.1 million. The SEC claims that Dinelli misappropriated over $1 million, including funds for a documentary film, while Frankel is alleged to have misappropriated more than $340,000, which he used for personal trading and legal fees.
In response to the SEC’s allegations, Frankel has denied wrongdoing, claiming that he terminated Dinelli two years prior and blaming him for the alleged fraudulent activities. Dinelli has not publicly commented on the allegations. Frankel has a prior criminal conviction for grand larceny and identity theft, which the SEC claims he failed to disclose to regulators.
The SEC’s actions against both Meyer and the duo of Dinelli and Frankel highlight a broader concern regarding the marketing tactics used by private fund advisers. Both cases illustrate a pattern where advisers misrepresented their access to high-profile investments and provided investors with misleading or fabricated statements about the safety and performance of their investments.
The SEC asserts that these advisers exploited the growing interest in pre-IPO companies amidst soaring valuations, particularly following SpaceX’s significant IPO. The regulatory body has ramped up its enforcement efforts in this area to protect investors, particularly those who may be less sophisticated or more vulnerable, such as veterans and retirees.
As the SEC continues its investigations and enforcement actions, the cases against Meyer and Beyond Alpha Ventures serve as stark reminders of the risks involved in private fund investments and the importance of regulatory oversight in safeguarding investor interests. The commission seeks not only penalties for the alleged misconduct but also measures to prevent future violations in the rapidly evolving landscape of private equity and venture capital investments.
