Middlesex Couple Indicted in Alleged $2.2M Ponzi Scheme Involving Fake Returns and Lavish Spending

State grand jury charges husband and wife with multiple financial crimes after claims of defrauding investors over two years through high-yield investment deception.

A Middlesex County couple has been indicted by a state grand jury on a range of financial crime charges stemming from an alleged Ponzi scheme in which they are accused of defrauding investors of over $2 million between January 2020 and August 2022.

According to Attorney General Matthew J. Platkin, Swapnil Rege, 50, and Reema Rege, 48, both of Monmouth Junction, New Jersey, were indicted for orchestrating a scheme through their investment entity, Swapstar Capital LLC, that promised exceptionally high annual returns—between 21 and 80 percent—based on what was purported to be profitable securities trading activity. Instead, funds were allegedly diverted for personal use and to provide fake returns to investors, a hallmark of classic Ponzi operations.

“Investment fraud schemes prey on vulnerable victims with empty promises of huge profits and guaranteed returns,” said Attorney General Platkin. “The defendants charged in this case allegedly used investors’ funds in a classic Ponzi scheme, enriching themselves along the way. The charges in the indictment serve as a reminder to those who would take advantage of New Jersey investors that we will hold you accountable.”

The indictment outlines that two investors were allegedly misled into investing a total of approximately $2.28 million. Swapnil Rege, acting as an investment adviser, is accused of stealing stocks worth over $119,000 from one investor’s trading account and misappropriating an additional $100,000 from the same investor’s retirement account. A $100,000 bad check was then allegedly issued by Rege in an attempt to repay the misappropriated funds.

Notably, the indictment alleges that Swapnil Rege failed to disclose a critical fact: since July 2019, he has been barred from involvement with the U.S. Securities and Exchange Commission. Prosecutors assert that this omission played a key role in convincing the victims to invest.

To sustain the appearance of legitimacy, Rege allegedly laundered more than $1.4 million in stolen funds to pay false investment returns, using investor money to reimburse other investors. Additionally, more than $500,000 was allegedly funneled through various financial accounts to conceal the origin and movement of the funds. These illicit funds were reportedly used for personal expenses, including the purchase of a mansion and credit card payments.

Reema Rege is charged alongside her husband on several counts, including securities fraud and theft by deception. She is also accused of receiving over $75,000 in stolen securities and money, allegedly knowing the funds were derived from criminal activity.

The indictment was presented to Superior Court Assignment Judge Robert T. Lougy in Mercer County, who transferred the case to Middlesex County, where the defendants will appear for arraignment at a future date.

“The defendants allegedly took advantage of investors by duping them out of millions of dollars and using the money for their personal benefit, while continuing a Ponzi scheme that paid investors fake returns with their own money,” said Legal Chief Pablo Quiñones of the Office of Securities Fraud and Financial Crimes Prosecutions (OSFFCP). “White-collar frauds, such as those alleged in this case, are a top priority of our office, and we will continue to ensure that those who engage in such conduct are brought to justice.”

The charges stem from an investigation conducted by the Division of Criminal Justice’s Office of Securities Fraud and Financial Crimes Prosecutions (OSFFCP), with detectives and investigators including Detective Nicholas Trocchio and Special Investigator Joseph Czarnecki contributing to the probe. Deputy Chief Adam Heck and Deputy Attorney General Michael Burke are prosecuting the case under the supervision of Legal Chief Quiñones and Deputy Legal Chief Brendan Stewart.

Authorities note that the investigation remains active and encourage anyone with relevant information to contact the Division of Criminal Justice’s tip line at (800) 277-2427 or email OSFFCP@njdcj.org.

It is important to note that the charges are allegations, and the defendants are presumed innocent unless and until proven guilty in a court of law.