SEC charges New York operator over $74M "pre-IPO" fund scheme built on hidden markups

The Securities and Exchange Commission on Aug. 14 charged Andrew Spaventa, a New York resident, along with The Spaventa Group LLC, TSG Capital Advisors LLC and TSG Alpha Partners LLC, with fraud and registration violations tied to eleven private funds that sold retail investors exposure to shares in privately held, pre-IPO companies.

Per the SEC's complaint, filed in the Southern District of New York, the defendants raised more than $74 million from over 800 investors — described as mostly retail — between roughly December 2020 and June 2025. The alleged mechanism was not a fake asset but a hidden spread: Spaventa, through entities he owned, bought pre-IPO shares either directly or via another investment fund, then sold them into his own funds in principal transactions at marked-up prices. Investors absorbed the markup as fees embedded in the sale of membership interests.

The gap is the case. The SEC alleges investors were told they would pay no upfront fees at all, or at most 12.5% — while the prices they actually paid averaged about 46% above what Spaventa had paid. The regulator says roughly $23 million in upfront fees was collected, of which more than $12 million went to sales agents as commissions and about $4 million went to Spaventa personally.

Distribution was old-fashioned. The SEC says more than 100 "sales agents" cold-called thousands of prospects, many of them retirees, using high-pressure tactics. "Unsolicited calls and high-pressure sales tactics are the calling cards of so-called boiler room operators," said Sheldon L. Pollock, associate director of the SEC's New York Regional Office. "They get you on the phone and then hit you with the hidden fees."

The complaint charges violations of the antifraud, securities registration and broker-dealer registration provisions of the Securities Act of 1933, the Securities Exchange Act of 1934 and the Investment Advisers Act of 1940, plus control person liability and aiding and abetting against Spaventa. The SEC seeks permanent injunctions, disgorgement with prejudgment interest, civil penalties, and conduct-based injunctions against Spaventa.

Key facts

• $74M+ raised from 800+ mostly retail investors across eleven funds, Dec. 2020–June 2025 — SEC complaint, via SEC press release 2026-75.
• ~46% average markup over Spaventa's purchase price, against disclosed fees of zero to 12.5% — SEC.
• ~$23M in upfront fees; $12M+ to sales agents, ~$4M to Spaventa — SEC.
• 100+ sales agents cold-calling, many targets retirees — SEC.
• Filed in SDNY; relief sought includes disgorgement, penalties and injunctions — SEC.

The real-world read

Three things the announcement doesn't resolve. First, the money: $23 million in fees is roughly 31% of the $74 million raised — well above even the 12.5% ceiling investors were allegedly quoted — and the SEC accounts for about $16 million of that ($12M to agents, $4M to Spaventa), leaving the remaining ~$7 million unexplained.

Second, the assets. The SEC's theory is about the spread, not the shares; it doesn't allege the underlying pre-IPO holdings were fake or worthless. Investors may own something. What it's worth, and whether it survives a five-year hold, isn't addressed.

Third, the framing. This is the enforcing agency's own account of its own case, published the day it filed. These are allegations. Spaventa and the entities have not answered the complaint, and no response from them was included. No parallel criminal action was announced, and there's no mention of an asset freeze or receiver — which is the detail that usually determines whether defrauded investors see money back.

Opinion, and whose

The only characterization on the record is the SEC's. Pollock's "boiler room" framing is the regulator's, offered alongside an advisory that investors be vigilant about unsolicited calls — a warning, not a finding. Nothing here has been tested in court.

Sources

• SEC, press release 2026-75 (Aug. 14, 2026) — the sole primary source: charges, defendants, dollar figures, dates, statutory counts, relief sought, and the Pollock quote. This is a party's statement about its own enforcement action, not an adjudication.
• SEC complaint (SDNY) — referenced and linked by the release; its full contents were not available for review here, so all specifics above are as characterized by the SEC's summary.

Not financial advice. Enforcement allegations are unproven until resolved in court.