A federal
court entered a final consent judgment last week against Matthew Motil, the
Ohio-based host of “The Cash Flow King” podcast, bringing closure to
an SEC enforcement action that began in September 2023. Motil operated a nearly
four-year fraud that pulled in more than $11 million from over 60 investors
scattered across the United States.
The
42-year-old sold promissory notes he claimed were backed by first-position
mortgages on residential properties throughout Ohio. He advertised himself as a
self-made real estate entrepreneur who helped “hundreds of investors
throughout the world to create massive wealth through real estate” through
his website and social media presence.
One House, Twenty
Investors
Court
documents paint a picture of serial over-leveraging that left investors with
worthless paper. In the most extreme case, Motil sold more than $1.3 million worth
of notes to at least 20 separate investors, all supposedly secured by a
single-family home on Hearthstone Road in Parma, Ohio. He purchased that
property in November 2017 for $47,000. Valuation services never appraised it at
more than $130,000.
Similar
patterns emerged across multiple properties. A Cleveland home on Leroy Avenue
that Motil bought for $51,000 was used to “collateralize” notes worth
at least $853,000 to 17 different investors. When he sold his last note on that
property in April 2021, he owed investors more than $635,000 against a property
valued at no more than $118,600.
The scheme
mirrors other real estate frauds that have drawn regulatory scrutiny. In Texas,
Justin Kimbrough operated Prosperity
Consultants, which promised returns from real estate deals before regulators discovered
the $3 million operation was paying existing investors with new
money.
Motil
rarely recorded the mortgages with county clerks despite promising investors he
would do so. This prevented prospective investors from discovering through
title searches that properties were already encumbered. He told investors that
county clerks were backlogged, buying himself time.
Retirement Funds Diverted
to Personal Spending
The SEC’s
complaint details how Motil spent investor money. Of the $11 million raised
during the period from October 2017 through May 2021, more than $3.7 million (33
percent) went to Ponzi payments. Another $1.6 million covered personal
expenses.
Those
personal expenses included more than $107,000 for a seven-month rental of a
lakeside mansion, over $73,000 for courtside seats to Cleveland Cavaliers
games, and more than $45,000 to repay student loans. Motil also spent over $14,000
at Starbucks, and nearly $14,000 at pizzerias.
The pattern
of diverting funds to luxury spending appears across multiple fraud cases. When
investment adviser Brian Swensen died while running a $29 million scheme,
investigators discovered he had used client money for real estate
purchases, vehicles, and multiple private aircraft
Criminal Sentence, Civil
Penalties
The
Northern District of Ohio criminal court sentenced Motil to 70 months in prison,
2025, and ordered him to pay restitution of more than $5 million. The parallel
SEC civil case resulted in a final consent judgment entered January 13, 2026.
Under the
consent judgment, Motil is permanently enjoined from violating securities
registration and anti-fraud provisions. He must pay disgorgement of $3 million plus
prejudgment interest, though that obligation is deemed satisfied by the
criminal restitution order. The court permanently barred Motil from
participating in the issuance, purchase, offer, or sale of any security, except
for purchasing securities listed on national exchanges for his personal
account.
Real estate
investment frauds have drawn heightened enforcement attention. The SEC
previously sued Florida-based Woodbridge
Funds and owner Robert Shapiro over a $1.2 billion Ponzi scheme involving real estate
development.
This article was written by Damian Chmiel at www.financemagnates.com.
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