SEC Wins $6.6M Judgment in BDX Chipset Investment Scheme
A federal court has entered a final consent judgment requiring Aaron Verdugo and two wholly owned entities to pay more than $6.6 million to resolve U.S. Securities and Exchange Commission charges tied to an alleged fraudulent securities offering pitched as a computer chipset investment program.
The entities are Verdugo Enterprizes LLC (d/b/a BDaaSWorx) and BDaaS Inc. (collectively, BDX). Without admitting or denying the SEC’s allegations, Verdugo and his companies consented to the judgment, which was entered by the U.S. District Court for the Southern District of Texas.
According to the SEC’s complaint, Verdugo raised approximately $6.67 million from about 200 investors between August 2022 and January 2024 through an unregistered offering known as the BDX Power Program.
Investors were told their money would be used to purchase computer chipset units that BDX would install and manage at a data center in Houston. Verdugo allegedly claimed that BDX had existing contracts with Fortune 500 technology companies to provide “big data as a service” (BDaaS), promising investors passive monthly income generated by those customer relationships.
The offering also included a “satisfaction guarantee” that promised investors a full refund — less any returns already paid — if they were dissatisfied for any reason.
The SEC alleged that BDX in fact had no customer contracts, no revenue, and provided no services to Fortune 500 companies.
By early 2023, the SEC’s investigation found BDX had ceased paying monthly returns to nearly all investors. The few refunds that were issued were allegedly funded by money from new investors.
Verdugo allegedly misappropriated at least $6.1 million of the $6.67 million raised. About $854,000 of investor funds went to unauthorized compensation, including a luxury vehicle, payments to his spouse, and personal credit card bills. Another $4.68 million was diverted to unauthorized operational expenses.
The SEC charged the defendants with violating the registration and anti-fraud provisions of the Securities Act of 1933 and the Securities Exchange Act of 1934.
Under the terms of the final judgment, the defendants must pay $5,537,678 in disgorgement plus $844,531 in prejudgment interest on a joint and several basis. Verdugo was also ordered to pay a personal civil penalty of $236,000.
Verdugo is also enjoined for five years from participating in the offer or sale of securities, except for his own personal account.
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