DoJ Charge VC in $8mn Ponzi

On Jun. 14, DoJ charged venture capital fund for $8mn Ponzi.

  • David Wagner and Marc Lawrence, were arrested on securities and wire fraud
    charges stemming from their several corporate entities (known to as Downing).


  • Defendants offered employee-investors the opportunity to get in on the ground
    floor of a multi-million-dollar venture capital business, in healthcare start-ups.
  • Wagner and Lawrence and others, solicited approximately $8mn in investment.
  • Employees were required to make an investment of between $150k and $250k.
  • Investors found out that Downing did not have access to millions in funding, had
    almost no products to sell, and that employee-investors were source of funding.
  • May 2016, even after several investors brought lawsuits, continued recruiting.
  • The new investments were in a company called Cliniflow Technologies (Cliniflow).
  • Cliniflow supposedly held majority ownership in same primary portfolio company as other Downing entities and was simply a new name used to solicit investments.
  • Most of $1.5mn raised through Cliniflow was transferred to other Downing entities.