SEC v. GAUNTLET HOLDINGS, LLC; DARRELL W. RIDEAUX; and ALI DERAKHSHANFAR, No. 8:25-cv-00492, Central District of California (Mar. 13, 2025) — Complaint

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RUA M. KELLY (Mass. Bar No. 643351) pro hac vice pending
Email: [email protected]
JONATHAN T. MENITOVE (Mass. Bar No. 710545) pro hac vice pending
Email: [email protected]
Securities and Exchange Commission
33 Arch Street, 24th  Floor
Boston, MA 02110
(617) 573-8941 (Kelly Direct)
(617) 573-4565 (Menitove Direct)
Facsimile: (617) 573-4590

Local Counsel
Kathryn Wanner (Cal. Bar No. 269310)
Email: [email protected]
Securities and Exchange Commission
444 S. Flower St., Suite 900
Los Angeles, CA  90071
(323) 965-3998
Facsimile: (213) 443-1904
UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
SOUTHERN DIVISION

SECURITIES AND EXCHANGE
COMMISSION,
Plaintiff,

vs.
GAUNTLET HOLDINGS, LLC,
DARRELL W. RIDEAUX, and ALI
DERAKHSHANFAR,
Defendants,

and SAL N. ORTIZ,

                     Relief Defendant.

 Case No. 8:25-cv-00492

COMPLAINT

DEMAND FOR JURY TRIAL

Plaintiff Securities and Exchange Commission (“SEC”) alleges:

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JURISDICTION AND VENUE
1. The Court has jurisdiction over this action pursuant to Sections 20(b)
and 22(a) of the Securities Act of 1933 (“Securities Act”) [15 U.S.C. §§77t(b) &
77v(a)]  and Sections 21(d), 21(e) and 27 of the Securities Exchange Act of 1934
(“Exchange Act”) [15 U.S.C. §§78u(d), 78u(e) & 78aa].
2. Defendants Gauntlet Holdings, LLC (“Gauntlet”), Darrell W. Rideaux
(“Rideaux”) and Ali Derakhshanfar (“Derakhshanfar”) and Relief Defendant Sal N.
Ortiz (“Ortiz”) have, directly or indirectly, made use of the means or instrumentalities
of interstate commerce, or of the mails, in connection with the transactions, acts,
practices and courses of business alleged in this complaint.
3. Venue is proper in this district pursuant to Section 22(a) of the Securities
Act [15 U.S.C. §77v(a)]  and Section 27(a) of the Exchange Act [15 U.S.C. §78aa(a)]
because certain of the transactions, acts, practices, and courses of conduct
constituting violations of the federal securities laws occurred within this district.
4. In addition, venue is proper in this district, because at all times relevant
to this Complaint, Defendant Gauntlet did business in this district, and Defendants
Rideaux and Derakhshanfar and Relief Defendant Ortiz resided in this district.
SUMMARY
5. This is a securities fraud enforcement action alleging two separate
schemes to violate the securities laws.  First, Defendants Gauntlet, Rideaux, and
Derakhshanfar  (collectively, the “Defendants”) engaged in a scheme to defraud a
Company (the “Company”) by fabricating a relationship with a wealthy member of a
Qatari royal family (the “Sheikh”) and convincing the Company that Derakhshanfar
had access to billions of dollars held by the Sheikh in an account at a Qatari bank (the
“Qatari Bank Account”).
6. Through this fraudulent scheme (hereafter, the “Qatari Bank Scheme”),
which began in 2020 and included multiple lies by Rideaux and Derakhshanfar, the
Defendants persuaded the Company’s affiliate to pay the Defendants $1 million as an

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“advance” on anticipated profits from transactions relying on $2 billion worth of
“senior secured notes” issued by Gauntlet (the “Gauntlet Notes”) that the Company
planned to use in future business operations.  In reality, none of the Defendants had a
relationship with the Qatari royal family, nor did they have access to billions in a
Qatari bank through the Sheikh.  The entire Qatari Bank Account appears to have
been a   complete fabrication.
7. In addition, beginning in or about March of 2024, Rideaux and Gauntlet
embarked on a second scheme to defraud an investor (“Investor A”) by offering an
investment opportunity in which investors’ assets would be pooled to purchase asset-
backed securities that would purportedly generate 200% returns in 30 days (the
“Second Scheme”).  After executing an investment agreement with Rideaux, Investor
A transferred $1 million to Rideaux’s attorney’s trust account, but never received the
promised returns, nor did he receive the return of his principal.  Throughout the
Second Scheme, Rideaux made numerous false and misleading statements, both to
solicit Investor A and to lull him into a false sense that his investment would be safe
and lucrative, including by emailing a misleading video to show “Gauntlet’s” online
bank account to the investor; in reality, the account did not belong to Gauntlet.
8. As a result of the conduct alleged herein, the Defendants violated, and
unless restrained and enjoined will continue to violate, Sections 17(a)(1), (a)(2), and
(a)(3) of the Securities Act of 1933 (“Securities Act”) [15 U.S.C. §§ 77q(a)(1), (2),
and (3)] and Section 10(b) of the Securities Exchange Act of 1934 (“Exchange Act”)
[15 U.S.C. §§ 78j(b)] and Rule 10b-5 (a), (b), and (c) thereunder [17 C.F.R. §
240.10b-5(a), (b), and (c)].
9. The Commission seeks a permanent injunction against the Defendants,
enjoining them from engaging in the transactions, acts, practices, and courses of
business alleged in this Complaint, or in conduct of similar purpose or effect;
disgorgement by the Defendants and the Relief Defendant of all ill-gotten gains from
the conduct alleged herein, with prejudgment interest, pursuant to Section 21(d)(5) of

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the Exchange Act [15 U.S.C. §78u(d)(5)]; civil penalties against the Defendants
pursuant to Section 20(d) of the Securities Act [15 U.S.C. § 77t(d)] and Section
21(d)(3) of the Exchange Act [15 U.S.C. §78u(d)(3)]; and such other relief as the
Court may deem appropriate.
DEFENDANTS   AND RELIEF DEFENDANT
10. Gauntlet is a Delaware limited liability company with its principal place
of business in Brea, California.  On its website, Gauntlet describes itself as a “family
office” that is not registered with FINRA and is exempt from SEC registration.

11. Rideaux, age 45, is a U.S. citizen who resides in Placentia, California.
Rideaux is the managing member of Gauntlet, through which he conducts business.
He holds Series 7, Series 63, and Series 66 securities licenses and has previously been
associated with several U.S.-based financial institutions.
12. Derakhshanfar, age 74, is a U.S. citizen who resides in Arcadia,
California.  Derakhshanfar runs an insurance business in Los Angeles.
13. Ortiz, age 59, is a U.S. citizen who resides in Chino, California.  Ortiz is
an accountant who serves as President and CEO of a tax preparation firm.  Ortiz is
also the CEO of a   liquor company, and the founder of an entertainment company as
well as a beverage distributor licensed in California.
RELATED ENTITIES AND INDIVIDUALS
14. The Company is a   privately-held company incorporated in Wyoming.  It
is affiliated with a group of companies held under common ownership.  Among the
companies affiliated with the Company are a   formerly publicly-traded company
incorporated in Delaware with its principal place of business in Beverly Hills,
California and a   privately-held corporation headquartered in the United Kingdom.
15. The Company CEO is the U.K.-based Chief Executive Officer of the
Company.
16. Investor A is an individual who invested $1 million with Rideaux and
Gauntlet in March of 2024.  To date, Investor A’s money has not been returned.

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THE ALLEGATIONS
A. Overview of the Qatari Bank Scheme
17. The Defendants’ fraudulent scheme began in 2020, when Rideaux was
introduced to the Company, and when Ortiz introduced Rideaux and Derakhshanfar
to each other.  Ortiz was a long-time friend of Rideaux and had more recently met
Derakhshanfar at a business function and had become friendly with him.
18. At that time, the Company’s business objective was to acquire minority
stakes in insurance companies and financial firms.  The Company planned to acquire
such minority stakes through the issuance of “credit-linked notes”
1
 that could then be
held by businesses as reserve capital – meaning that insurance companies and
financial firms would have the   Company’s credit-linked notes available to draw upon
if they needed access to capital, thereby meeting capital reserve regulatory
requirements.
19. In order to put this business plan into action, the Company first needed a
source of money, which could serve as the collateral for credit-linked notes.
B. The Defendants Schemed to Convince the Company That They Had
Access to Billions in a Qatari Bank Account Through Derakhshanfar.
20. Beginning in mid-2020, the Defendants deployed an extensive scheme to
convince the Company CEO that the Qatari Bank Account was real, that it held $7.98
billion, that Derakhshanfar had access to it through his connection to the Sheikh, and
that this money could be used as collateral securing promissory notes issued by
Gauntlet that the Company purchased to execute its business plan.
21. The Defendants played different roles in the scheme.  Rideaux served as
the primary liaison with the Company, provided reassurances that the Qatari Bank
Account existed, assured   the Company CEO as to the legitimacy of a Gmail address

1
 A credit-linked note is a security that is similar to a traditional bond, but that contains an
embedded credit default swap.  Credit-linked notes typically earn a higher rate of return than
traditional bonds because they often include higher exposure to credit risk than bonds.

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that was purportedly the Sheikh’s personal email address, and manipulated the
Company CEO and the Company’s counsel to avoid the Company or its
representatives directly reaching out to the Qatari bank.  Derakhshanfar pretended to
have a connection with the Sheikh, operated the Sheikh’s Gmail address, and fulfilled
requests for documents that Rideaux passed along when the Company performed its
due diligence of the transaction.
22. At the inception of the scheme, in early 2020, Rideaux informed the
Company CEO that he represented an individual named Ali Derakhshanfar, claiming
that Derakhshanfar had access to a large amount of cash deposited at a bank in Qatar,
because Derakhshanfar had won the trust of a Qatari sheikh.  While Rideaux used
Derakhshanfar’s real name, he did not tell the Company CEO that Derakhshanfar was
actually an insurance salesman who resided in California and had no connection to
the Qatari royal family.
23. The Defendants – led by Rideaux – effected the scheme by offering the
Company $2 billion worth of “senior secured notes” to be issued by Gauntlet (the
“Gauntlet Notes”).  As consideration for the Gauntlet Notes, Gauntlet was to receive
convertible redeemable preferred shares in the Company, which provided the holders
of those securities with dividends linked to transactions executed under the
anticipated credit-linked note program.
24. In a memorandum of understanding (“MOU”) dated June 16, 2020,
Gauntlet and the Company agreed that the Company would obtain $1 billion of
Gauntlet Notes in exchange for providing Gauntlet with convertible redeemable
preferred stock.  The convertible redeemable preferred stock would pay a dividend
linked to profits obtained from transactions under the anticipated credit-linked note
program, with Gauntlet and the Company splitting the profits equally.  The June 16,
2020 MOU expressly stated that the Gauntlet Notes were “fully backed by a pledged
cash account” at the Qatari bank.  In a second MOU dated June 21, 2020, Rideaux
(signing on behalf of Gauntlet), Derakhshanfar, and Ortiz agreed to split the profits

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paid to Gauntlet, with 40% to Gauntlet and Rideaux, 40% to Derakhshanfar, and 20%
to Ortiz (purportedly for Ortiz’s role in introducing and facilitating the exchange of
information between certain of the parties to the agreement).  The June 16, 2020
MOU was subsequently amended in an agreement dated July 30, 2020 to provide that
Gauntlet would sell $2 billion worth of Gauntlet Notes in exchange for additional
convertible redeemable preferred shares.  Similar to the June 16, 2020 MOU, the July
30, 2020 agreement stated that the “Senior Secured Notes for an aggregate amount of
Two Billion Dollars ($2,000,000,000.00) with the funds for such Notes to be
deposited as collateral at the [Qatari bank].”
25. The Gauntlet Notes each had a face value of $50 million, and each
promised to pay its face value upon maturity in July 2030.  The Gauntlet Notes were
purportedly backed by a “Security Interest,” defined as a “first priority security
interest in the [USD] equivalent to the face value” of the note held at the Qatari bank,
with a specific account number identified.  Each Gauntlet Note contained a paragraph
titled “Investment Intent,” in which the holder of the note “warrants and represents
that . . . any security issuable hereof will be acquired for investment only.”  In
addition, each Gauntlet Note contained a heading that described the note as a security
and stated that it had not been registered with the SEC or any state securities
authority.  The Gauntlet Notes also each contained a paragraph titled “Transfer of this
Note,” which provided as follows:
Neither this note nor any of the rights, interests or obligations hereunder, shall
be assigned, sold, pledged, transferred or otherwise disposed of except with the
prior written consent of the Issuer and in compliance with the Securities Act of
1933, as amended ..., applicable state securities laws, and the Note Issuance
Agreement.
26. In February and March of 2021, the Company’s affiliate based in the
United Kingdom transferred a total of $1 million USD by wire to its counsel in the
United States.  The money was transferred to pay the Defendants and Ortiz an

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“advance” on profits from the Company’s    credit-linked note program to be backed by
the Gauntlet Notes.  Excepting $15,000 that counsel retained, counsel distributed the
$1 million to the Defendants and Ortiz.
27. In truth, there were no funds backing the Gauntlet Notes, and the Qatari
bank documents provided to the Company during the due diligence process appear to
have been fabricated.  While the Gauntlet Notes listed an account number for the
Qatari Bank Account, that account number did not exist and in any event, it did not
match the format of account numbers used at the Qatari bank.  Moreover, financial
records for the Qatari bank show that the total amount of money held at the bank that
individual, non-entity account holders had deposited was less than the $7.98 billion
that the Defendants claimed that Derakhshanfar could access in a single Qatari Bank
Account purportedly belonging to the Sheikh.
28. In addition, records reflecting IP address
2
 login information show that,
on at least certain occasions, the Sheikh’s alleged Gmail address used to provide
documentation supporting the existence of funds at the Qatari Bank Account was
accessed at the exact same time and location where Derakhshanfar accessed his own
Gmail account, indicating that the Gmail account for the “Sheikh” was, in fact,
controlled by Derakhshanfar.
C. Rideaux and Derakhshanfar Misled and Lied to the Company about the
Alleged $7.98 Billion Bank Account in Qatar
29. The Defendants were able to effect this scheme by manipulating through
lies and omissions the Company CEO to believe that the Qatari Bank Account was
real and that Derakhshanfar had access to it.  For example, Rideaux – recognizing
that it might seem suspicious that a sheikh relied on a commonly used application
such as Gmail – sought to preempt any concerns by explaining its use to the
Company CEO: “While I was somewhat apprehensive of the gmail [sic] being used it

2
 An IP address is a unique string of characters that identifies a device on the internet or a local
network.

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is apparently understood and accepted by the Royal Family.  Please acknowledge
receipt of this email and the understanding that Ali [Derakhshanfar] reports to [the]
Shiek [sic] ...”
30. Rideaux also provided the Company and its counsel with a “bank
confirmation letter” from an administrator at the Qatari bank, purportedly evidencing
the account and confirming a $7.98 billion balance in the Qatari Bank Account.
Rideaux further shared with the Company CEO and the counsel he retained
screenshots of a bank statement reflecting a $7.98 billion balance in the Qatari Bank
Account; the screenshots were attached to what appeared to be an email from the
Qatari bank that the Sheikh’s Gmail address had purportedly forwarded to
Derakhshanfar.
31. To ensure the scheme’s success, the Defendants sought to quash any
efforts to reach out directly to the Qatari bank to confirm the existence of these funds.
On one occasion, when counsel the Company CEO retained attempted to reach out to
a publicly-listed email for the Qatari bank, Rideaux expressed concern and upset,
cautioning the Company that sending the email was a “breach in procedures” that
“caused tremendous damage and may have consequences beyond repair.”  Before
allowing further due diligence, Rideaux ordered the Company CEO to send an
apology to the Sheikh’s Gmail address, which he did, and his counsel sent an
additional apologetic email to that email account.
32. In fact, even as these apologies were made, the Defendants were
fabricating documents in furtherance of the scheme.  On July 21, 2020, the Sheikh’s
Gmail address sent an email to counsel the Company CEO had retained attaching two
letters, one on “State of Qatar” stationery and the other on stationery from the Qatari
bank.  Both letters attested to the validity of a bank comfort letter, bank statements,
and screenshots showing an account balance and confirmed that Derakhshanfar was
the owner of an account identified by a specific account number.  Further, on August
3, 2020, the Sheikh’s Gmail address sent an email to the Company CEO and his

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counsel.  The Gmail message attached a letter printed on “State of Qatar” stationery
and the letter vouched for Derakhshanfar as a “fiduciary” for the Sheikh.  However,
email traffic between the Defendants shows that Rideaux drafted the language of the
“Sheikh’s” Gmail message and provided it to Derakhshanfar.
33. Rideaux’s manipulation of the Company CEO is further evidenced in
communications concerning a press release the Company CEO had hoped to issue.  In
August 2020, the Company CEO sent Rideaux a draft press release, noting that the
Sheikh, on behalf of the Qatari royal family, had invested $2 billion in the Company.
Rideaux responded, rewriting the draft press release to remove any mention of the
Qatari royal family, telling the Company CEO that any mention of the royal family
would be in violation of a non-d isclosure agreement.  In truth, Rideaux sought to
avoid any mention of the royal household because there was no actual investment of
$2 billion from the Qatari royal family.
34. Rideaux further projected a false air of legitimacy by touting his
purported ties to Qatari royalty.  In a   January 2021 email to the Company CEO,
Rideaux forwarded a Los Angeles Times article entitled “The true story of the
heartthrob prince of Qatar and his time at USC.”  The article described the conduct of
a member of the Qatari royal family (not the “Sheikh” who purportedly entrusted
money to Derakhshanfar) while he was a student at the University of Southern
California.  Rideaux – a former football player at USC who played with the team in
the 2003 Orange Bowl – told the Company CEO that “[t]his is how I came to meet
[Derakhshanfar] and the [royal family of Qatar].”  In fact, Rideaux graduated from
USC several years before the Qatari prince arrived on the campus.
35. In addition to touting his own purported ties to the Qatari royal family,
Rideaux continued to tout Derakhshanfar’s ties to Qatari royalty.  In a February 22,
2021 letter to the Company CEO, Rideaux said, in relevant part: “Mr. Derakhshanfar,
who has had an account at [the Qatari bank] since 2013; is a sovereign fund manager
who has a close relationship to members of the ... Royal Family of Qatar.”

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D. The Defendants Obtained $1 Million Through the Qatari Bank Scheme
36. In February 2021, the Company’s affiliate in the United Kingdom made
an initial $250,000 payment that was divided among the Defendants.  Derakhshanfar
received $175,000, Rideaux received $30,000, and Ortiz received $30,000, with the
remaining $15,000 going to the Company’s attorney.  In mid-March 2021, the
Company’s affiliate in the United Kingdom paid the remaining $750,000 to the
Defendants.  This time, Rideaux received $212,500, Derakhshanfar received
$325,000, and Ortiz received $112,500, with the remaining $100,000 going to
Derakhshanfar’s attorney.
E. Overview of the Second Scheme by Rideaux and Gauntlet
37.   In early 2024, Rideaux connected with Investor A through the
WhatsApp communications application, where Rideaux pitched Investor A on a
potential investment opportunity in which Investor A’s money would be pooled with
other investors to purchase asset-backed securities.  Through messages exchanged
with Rideaux, Investor A received a one-page document describing a “Special 30-
Day Small Cap Program,” stating that the program was “[b]y invitation only.  200%
return after 30 Days.  1M Minimum/ 5M maximum.”
38. In March 2024, Rideaux met with Investor A on Zoom, along with a
mutual acquaintance who had introduced the two.  Rideaux told Investor A during the
meeting that he had worked for a prominent broker-dealer in the U.S., that he was a
financial adviser for wealthy clients, and that he had made millions for those clients.
In describing his professional background, Rideaux omitted the fact that since 2018
he had been barred from associating with any FINRA member (including any broker-
dealer) after an investigation into potential securities law violations at his prior firm.
39. During the March 2024 meeting with Investor A, Rideaux displayed a
flow chart that purported to show how investor funds would be used by Gauntlet to
“[p]urchase security and receive monthly pass-through of principal and interest from
borrowers.”  The chart showed that funds from investors would flow to Gauntlet,

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which would then use the funds to purchase loans from issuers.  Rideaux reiterated
that Investor A could invest with Gauntlet and receive 200% returns within 30 days.
40. Investor A, Rideaux, and others executed a written “Joint Venture /
Partnership Management Agreement” that described an “Investment Offer” involving
a $1 million investment to be sent to an escrow account.  The agreement
contemplates an investment that lasts 10 banking days promising a return of 50%
derived from an investment strategy executed by a firm Rideaux’s brother-in-law
purportedly managed.  Investor A’s obligation was limited to sending $1 million to
the escrow account, and Investor A was assured that, with respect to the way the
investment works, “the principal remains in the non-depletion account.”  The
agreement specified that information about the investment opportunity would be
presented to other investors, “especially private accredited investors seeking high-
yield returns uncorrelated to the stock market.”  The contract terms gave Investor A
the ability to terminate the contract via writing or electronic mail and further provided
that Gauntlet and others “shall earn profits net of distributions” to Investor A.
41. Between March 22 and March 25, 2024, Investor A transferred $1
million to Rideaux’s attorney’s trust account to be invested with Gauntlet.
F.   Rideaux Makes Numerous Misstatements to Investor A
42. Notwithstanding the provision in the “Joint Venture / Partnership
Management Agreement” specifying that funds would not be transferred, Investor
A’s money was quickly wired out of the escrow account.  Further, notwithstanding
the provision in the agreement specifying that Gauntlet would earn profits net of
distributions to Investor A, Rideaux and other Gauntlet employee received Investor
A’s money without Investor A receiving any distributions.
43. In April 2024, after 30 days elapsed, Investor A began what would
ultimately be a months-long and failed quest to get his money back.  Investor A
called, emailed, and sent WhatsApp messages to Rideaux, who responded with
misrepresentations and omissions to lull Investor A into a false sense of security.

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44. For example, on June 20, 2024, Rideaux sent Investor A an email titled:
“Video from Gauntlet Family Office.”  The email assured Investor A that his funds
were safe and claimed that Investor A’s principal would be returned shortly.  Rideaux
attached to the email the video referenced in the subject line, which showed an online
bank account with a balance of $1.75 million.  However, that account did not belong
to Gauntlet, but to an Arizona-based entity.  Rideaux appears to have obtained online
access to the Arizona-based entity’s bank account through an agreement nearly
identical to the “Joint Venture / Partnership Management Agreement” Gauntlet
executed with Investor A.  In the agreement, Rideaux promised the Arizona-based
entity a return on its capital if the Arizona-based entity kept money in its account and
gave Rideaux online access.  Rideaux used this access to take a video of the account
to send to Investor A in an effort to assure Investor A that his funds were safe.  In
fact, the funds in the account were completely unrelated to Gauntlet or Investor A’s
investment.
45. Investor A continued to communicate with Rideaux through various
means over the following weeks, including WhatsApp, texts, emails, and calls to
Gauntlet’s office and Rideaux’s cell phone.  Rideaux responded with a variety of
misleading statements about the safety and expected return of Investor A’s $1 million
investment with Gauntlet.  Among other things, Rideaux periodically sent Investor A
photographs of what purported to be stacks of cash in wrappers from the bank as
evidence that he was in possession of substantial funds.  At other times, Rideaux sent
visual evidence of his excuses for delays, such as a GPS image of his whereabouts, or
a photo of him on a plane in order to justify to Investor A why Rideaux was
unavailable to discuss the status of the $1 million investment.
46. On July 19, 2024 – almost three months after Gauntlet was required to
return his principal with interest – Investor A emailed Rideaux pleading for an update
on the status of his investment: “I’ve tried to call you and text you... but without any
answer or feedback.  You promised me that you [would] transfer USD 1.435 million

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from your [bank] to [your lawyer’s] account on Wednesday morning as the payback
of my investment.  ... Could you get back to me [with] the update ASAP?”
47. As of today’s date, Investor A has not received any principal or interest
from Rideaux and/or anyone associated with Gauntlet.
FIRST CLAIM FOR RELIEF
Fraud in the Connection with the Purchase and Sale of Securities
Violations of Section 10(b) of the Exchange Act and Rule 10b-5
(against Defendants Gauntlet, Rideaux, and Derakhshanfar)
48. The SEC realleges and incorporates by reference paragraphs 1 through
47 above.
49. During the Relevant Period, the Gauntlet Notes were securities under
Section 3(a)(10) of the Exchange Act, 15 U.S.C. §78c(a)(10).
50. By engaging in the conduct described above, Defendants Gauntlet,
Rideaux, and Derakhshanfar, directly or indirectly, in connection with the purchase or
sale of a security, by the use of means or instrumentalities of interstate commerce, of
the mails, or of the facilities of a national securities exchange:  (a) employed devices,
schemes, or artifices to defraud; (b) made untrue statements of a material fact or
omitted to state a material fact necessary in order to make the statements made, in the
light of the circumstances under which they were made, not misleading; and (c)
engaged in acts, practices, or courses of business which operated or would operate as
a fraud or deceit upon other persons.
51. By engaging in the conduct described above, Defendants Gauntlet,
Rideaux, and Derakhshanfar violated, and unless restrained and enjoined will
continue to violate, Section 10(b) of the Exchange Act, 15 U.S.C. §78j(b), and Rules
10b-5(a), 10b-5(b), and 10b-5(c) thereunder, 17 C.F.R. §§240.10b-5(a), 240.10b-5(b)
& 240.10b-5(c).

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SECOND CLAIM FOR RELIEF
Fraud in the Offer or Sale of Securities
Violations of Section 17(a) of the Securities Act
(against Defendants Gauntlet, Rideaux, and Derakhshanfar)
52. The SEC realleges and incorporates by reference paragraphs 1 through
47 above.
53. During the Relevant Period, the Gauntlet Notes were securities under
Section 2(a)(1) of the Securities Act, 15 U.S.C. §77b(a)(1).
54. By engaging in the conduct described above, the Defendants, directly or
indirectly, in the offer or sale of securities, and by the use of means or instruments of
transportation or communication in interstate commerce or by use of the mails
directly or indirectly:  (a) employed devices, schemes, or artifices to defraud; (b) have
obtained money or property by making untrue statements of material fact or omitting
material facts necessary to make the statements not misleading; and/or (c) engaged in
transactions, practices, or courses of business which operated or would operate as a
fraud or deceit upon the purchaser.
55. Defendants, with scienter, employed devices, schemes and artifices to
defraud; and with scienter or negligence, engaged in transactions, practices, or
courses of business which operated or would operate as a fraud or deceit upon the
purchaser.
56. By engaging in the conduct described above, Defendants violated, and
unless restrained and enjoined will continue to violate, Sections 17(a)(1), 17(a)(2),
and 17(a)(3) of the Securities Act, 15 U.S.C. §§ 77q(a)(1), (2) and (3).
THIRD CLAIM FOR RELIEF
Other Equitable Relief, Including Unjust Enrichment
and Constructive Trust
(against Relief Defendant Ortiz)
57.   The Commission realleges and incorporates by references paragraphs 1

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through 47 as if fully set forth herein.
58. Section 21(d)(5) of the Exchange Act states, “In any action or
proceeding brought or instituted by the Commission under any provision of the
securities laws, the Commission may seek, and any Federal court may grant, any
equitable relief that may be appropriate or necessary for the benefit of investors.”
59. Relief Defendant Ortiz received ill-gotten funds provided by the
Company for purposes of investment with the Defendants.  Relief Defendant has no
legitimate claim to this property.  In equity and good conscience, Relief Defendant
should not be allowed to retain such funds.
60. As a result, Relief Defendant is liable for unjust enrichment and should
be required to return the ill-gotten gains, in an amount to be determined by the Court.
The Court should also impose a constructive trust on the ill-gotten gains in the
possession of the Relief Defendant.
FOURTH CLAIM FOR RELIEF
Fraud in the Connection with the Purchase and Sale of Securities
Violations of Section 10(b) of the Exchange Act and Rule 10b-5
(against Defendants Gauntlet and Rideaux)
61. The SEC realleges and incorporates by reference paragraphs 1 through
47 above.
62. During the Relevant Period, the securities offered to Investor A were
securities under Section 3(a)(10) of the Exchange Act, 15 U.S.C. §78c(a)(10).
63. By engaging in the conduct described above, Defendants Gauntlet and
Rideaux, directly or indirectly, in connection with the purchase or sale of a security,
by the use of means or instrumentalities of interstate commerce, of the mails, or of
the facilities of a national securities exchange:  (a) employed devices, schemes, or
artifices to defraud; (b) made untrue statements of a material fact or omitted to state a
material fact necessary in order to make the statements made, in the light of the
circumstances under which they were made, not misleading; and (c) engaged in acts,

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practices, or courses of business which operated or would operate as a fraud or deceit
upon other persons.
64. By engaging in the conduct described above, Defendants Gauntlet and
Rideaux violated, and unless restrained and enjoined will continue to violate, Section
10(b) of the Exchange Act, 15 U.S.C. §78j(b), and Rules 10b-5(a), 10b-5(b), and 10b-
5(c) thereunder, 17 C.F.R. §§240.10b-5(a), 240.10b-5(b) & 240.10b-5(c).
FIFTH CLAIM FOR RELIEF
Fraud in the Offer or Sale of Securities
Violations of Section 17(a) of the Securities Act
(against Defendants Gauntlet and Rideaux)
65. The SEC realleges and incorporates by reference paragraphs 1 through
47 above.
66. During the Relevant Period, the securities offered to Investor A were
securities under Section 2(a)(1) of the Securities Act, 15 U.S.C. §77b(a)(1).
67. By engaging in the conduct described above, the Defendants, directly or
indirectly, in the offer or sale of securities, and by the use of means or instruments of
transportation or communication in interstate commerce or by use of the mails
directly or indirectly:  (a) employed devices, schemes, or artifices to defraud; (b) have
obtained money or property by making untrue statements of material fact or omitting
material facts necessary to make the statements not misleading; and/or (c) engaged in
transactions, practices, or courses of business which operated or would operate as a
fraud or deceit upon the purchaser.
68. Defendants, with scienter, employed devices, schemes and artifices to
defraud; and with scienter or negligence, engaged in transactions, practices, or
courses of business which operated or would operate as a fraud or deceit upon the
purchaser.
69. By engaging in the conduct described above, Defendants violated, and
unless restrained and enjoined will continue to violate, Sections 17(a)(1), 17(a)(2),

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and 17(a)(3) of the Securities Act, 15 U.S.C. §§ 77q(a)(1), (2), and (3).
PRAYER FOR RELIEF
WHEREFORE, the SEC respectfully requests that the Court:
I.
Issue judgments, in forms consistent with Rule 65(d) of the Federal Rules of
Civil Procedure, permanently enjoining Defendants and their agents, servants,
employees and attorneys, and those persons in active concert or participation with
any of them, from directly or indirectly engaging in the conduct described above, or
in conduct of similar purpose or effect, in violation of Section 17(a) of the Securities
Act [15 U.S.C. §77q(a)], and Section 10(b) of the Exchange Act [15 U.S.C. §§78j(b)]
and Rule 10b-5 thereunder [17 C.F.R. §240.10b-5].
II.
Order Defendants to disgorge all ill-gotten gains from the conduct alleged
herein, with prejudgment interest, pursuant to Section 21(d)(5) of the Exchange Act
[15 U.S.C. §78u(d)(5)].
III.
Order Defendants to pay civil penalties under Section 20(d) of the Securities
Act [15 U.S.C. §77t(d)] and Section 21(d)(3) of the Exchange Act [15 U.S.C.
§78u(d)(3)].
IV.
Order the Relief Defendant to disgorge all ill-gotten gains or unjust
enrichment, with prejudgment interest thereon, to effect the remedial purposes of the
federal securities laws.
V.
Retain jurisdiction of this action in accordance with the principles of equity and
the Federal Rules of Civil Procedure in order to implement and carry out the terms of
all orders and decrees that may be entered, or to entertain any suitable application or
motion for additional relief within the jurisdiction of this Court.

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VI.
Grant such other and further relief as this Court may determine to be just and
necessary.

Dated:  March 13, 2025 /s/     Kathryn Wanner
KATHRYN WANNER
RUA M. KELLY (pro hac vice pending)
JONATHAN T. MENITOVE (pro hac
vice pending)
Attorneys for Plaintiff
Securities and Exchange Commission

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RUA M. KELLY (Mass. Bar No. 643351) pro hac vice pending 
Email: [email protected] 
JONATHAN T. MENITOVE (Mass. Bar No. 710545) pro hac vice pending 
Email: [email protected]  
Securities and Exchange Commission 
33 Arch Street, 24th Floor 
Boston, MA 02110 
(617) 573-8941 (Kelly Direct) 
(617) 573-4565 (Menitove Direct) 
Facsimile: (617) 573-4590 
 
Local Counsel 
Kathryn Wanner (Cal. Bar No. 269310) 
Email: [email protected] 
Securities and Exchange Commission 
444 S. Flower St., Suite 900 
Los Angeles, CA  90071 
(323) 965-3998  
Facsimile: (213) 443-1904 

UNITED STATES DISTRICT COURT 
CENTRAL DISTRICT OF CALIFORNIA 

SOUTHERN DIVISION 
 

SECURITIES AND EXCHANGE 
COMMISSION, 

Plaintiff, 
 

vs. 

GAUNTLET HOLDINGS, LLC, 
DARRELL W. RIDEAUX, and ALI 
DERAKHSHANFAR, 

Defendants, 
 
and SAL N. ORTIZ,  
 
                     Relief Defendant. 
 

 Case No. 8:25-cv-00492 
 
 
COMPLAINT 
 
DEMAND FOR JURY TRIAL 

 
Plaintiff Securities and Exchange Commission (“SEC”) alleges: 

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JURISDICTION AND VENUE 

1. The Court has jurisdiction over this action pursuant to Sections 20(b) 

and 22(a) of the Securities Act of 1933 (“Securities Act”) [15 U.S.C. §§77t(b) & 

77v(a)] and Sections 21(d), 21(e) and 27 of the Securities Exchange Act of 1934 

(“Exchange Act”) [15 U.S.C. §§78u(d), 78u(e) & 78aa]. 

2. Defendants Gauntlet Holdings, LLC (“Gauntlet”), Darrell W. Rideaux 

(“Rideaux”) and Ali Derakhshanfar (“Derakhshanfar”) and Relief Defendant Sal N. 

Ortiz (“Ortiz”) have, directly or indirectly, made use of the means or instrumentalities 

of interstate commerce, or of the mails, in connection with the transactions, acts, 

practices and courses of business alleged in this complaint.  

3. Venue is proper in this district pursuant to Section 22(a) of the Securities 

Act [15 U.S.C. §77v(a)] and Section 27(a) of the Exchange Act [15 U.S.C. §78aa(a)] 

because certain of the transactions, acts, practices, and courses of conduct 

constituting violations of the federal securities laws occurred within this district.   

4. In addition, venue is proper in this district, because at all times relevant 

to this Complaint, Defendant Gauntlet did business in this district, and Defendants 

Rideaux and Derakhshanfar and Relief Defendant Ortiz resided in this district.   

SUMMARY 

5. This is a securities fraud enforcement action alleging two separate 

schemes to violate the securities laws.  First, Defendants Gauntlet, Rideaux, and 

Derakhshanfar (collectively, the “Defendants”) engaged in a scheme to defraud a 

Company (the “Company”) by fabricating a relationship with a wealthy member of a 

Qatari royal family (the “Sheikh”) and convincing the Company that Derakhshanfar 

had access to billions of dollars held by the Sheikh in an account at a Qatari bank (the 

“Qatari Bank Account”).   

6. Through this fraudulent scheme (hereafter, the “Qatari Bank Scheme”), 

which began in 2020 and included multiple lies by Rideaux and Derakhshanfar, the 

Defendants persuaded the Company’s affiliate to pay the Defendants $1 million as an 

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“advance” on anticipated profits from transactions relying on $2 billion worth of 

“senior secured notes” issued by Gauntlet (the “Gauntlet Notes”) that the Company 

planned to use in future business operations.  In reality, none of the Defendants had a 

relationship with the Qatari royal family, nor did they have access to billions in a 

Qatari bank through the Sheikh.  The entire Qatari Bank Account appears to have 

been a complete fabrication.  

7. In addition, beginning in or about March of 2024, Rideaux and Gauntlet 

embarked on a second scheme to defraud an investor (“Investor A”) by offering an 

investment opportunity in which investors’ assets would be pooled to purchase asset-

backed securities that would purportedly generate 200% returns in 30 days (the 

“Second Scheme”).  After executing an investment agreement with Rideaux, Investor 

A transferred $1 million to Rideaux’s attorney’s trust account, but never received the 

promised returns, nor did he receive the return of his principal.  Throughout the 

Second Scheme, Rideaux made numerous false and misleading statements, both to 

solicit Investor A and to lull him into a false sense that his investment would be safe 

and lucrative, including by emailing a misleading video to show “Gauntlet’s” online 

bank account to the investor; in reality, the account did not belong to Gauntlet. 

8. As a result of the conduct alleged herein, the Defendants violated, and 

unless restrained and enjoined will continue to violate, Sections 17(a)(1), (a)(2), and 

(a)(3) of the Securities Act of 1933 (“Securities Act”) [15 U.S.C. §§ 77q(a)(1), (2), 

and (3)] and Section 10(b) of the Securities Exchange Act of 1934 (“Exchange Act”) 

[15 U.S.C. §§ 78j(b)] and Rule 10b-5(a), (b), and (c) thereunder [17 C.F.R. § 

240.10b-5(a), (b), and (c)].   

9. The Commission seeks a permanent injunction against the Defendants, 

enjoining them from engaging in the transactions, acts, practices, and courses of 

business alleged in this Complaint, or in conduct of similar purpose or effect; 

disgorgement by the Defendants and the Relief Defendant of all ill-gotten gains from 

the conduct alleged herein, with prejudgment interest, pursuant to Section 21(d)(5) of 

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the Exchange Act [15 U.S.C. §78u(d)(5)]; civil penalties against the Defendants 

pursuant to Section 20(d) of the Securities Act [15 U.S.C. § 77t(d)] and Section 

21(d)(3) of the Exchange Act [15 U.S.C. §78u(d)(3)]; and such other relief as the 

Court may deem appropriate. 

DEFENDANTS AND RELIEF DEFENDANT 

10. Gauntlet is a Delaware limited liability company with its principal place 

of business in Brea, California.  On its website, Gauntlet describes itself as a “family 

office” that is not registered with FINRA and is exempt from SEC registration.   

11. Rideaux, age 45, is a U.S. citizen who resides in Placentia, California.  

Rideaux is the managing member of Gauntlet, through which he conducts business.  

He holds Series 7, Series 63, and Series 66 securities licenses and has previously been 

associated with several U.S.-based financial institutions. 

12. Derakhshanfar, age 74, is a U.S. citizen who resides in Arcadia, 

California.  Derakhshanfar runs an insurance business in Los Angeles. 

13. Ortiz, age 59, is a U.S. citizen who resides in Chino, California.  Ortiz is 

an accountant who serves as President and CEO of a tax preparation firm.  Ortiz is 

also the CEO of a liquor company, and the founder of an entertainment company as 

well as a beverage distributor licensed in California.   

RELATED ENTITIES AND INDIVIDUALS 

14. The Company is a privately-held company incorporated in Wyoming.  It 

is affiliated with a group of companies held under common ownership.  Among the 

companies affiliated with the Company are a formerly publicly-traded company 

incorporated in Delaware with its principal place of business in Beverly Hills, 

California and a privately-held corporation headquartered in the United Kingdom. 

15. The Company CEO is the U.K.-based Chief Executive Officer of the 

Company. 

16. Investor A is an individual who invested $1 million with Rideaux and 

Gauntlet in March of 2024.  To date, Investor A’s money has not been returned. 

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THE ALLEGATIONS 

A. Overview of the Qatari Bank Scheme 

17. The Defendants’ fraudulent scheme began in 2020, when Rideaux was 

introduced to the Company, and when Ortiz introduced Rideaux and Derakhshanfar 

to each other.  Ortiz was a long-time friend of Rideaux and had more recently met 

Derakhshanfar at a business function and had become friendly with him.  

18. At that time, the Company’s business objective was to acquire minority 

stakes in insurance companies and financial firms.  The Company planned to acquire 

such minority stakes through the issuance of “credit-linked notes”1 that could then be 

held by businesses as reserve capital – meaning that insurance companies and 

financial firms would have the Company’s credit-linked notes available to draw upon 

if they needed access to capital, thereby meeting capital reserve regulatory 

requirements.   

19. In order to put this business plan into action, the Company first needed a 

source of money, which could serve as the collateral for credit-linked notes.   

B. The Defendants Schemed to Convince the Company That They Had 

Access to Billions in a Qatari Bank Account Through Derakhshanfar. 

20. Beginning in mid-2020, the Defendants deployed an extensive scheme to 

convince the Company CEO that the Qatari Bank Account was real, that it held $7.98 

billion, that Derakhshanfar had access to it through his connection to the Sheikh, and 

that this money could be used as collateral securing promissory notes issued by 

Gauntlet that the Company purchased to execute its business plan. 

21. The Defendants played different roles in the scheme.  Rideaux served as 

the primary liaison with the Company, provided reassurances that the Qatari Bank 

Account existed, assured the Company CEO as to the legitimacy of a Gmail address 

 
1 A credit-linked note is a security that is similar to a traditional bond, but that contains an 
embedded credit default swap.  Credit-linked notes typically earn a higher rate of return than 
traditional bonds because they often include higher exposure to credit risk than bonds. 

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that was purportedly the Sheikh’s personal email address, and manipulated the 

Company CEO and the Company’s counsel to avoid the Company or its 

representatives directly reaching out to the Qatari bank.  Derakhshanfar pretended to 

have a connection with the Sheikh, operated the Sheikh’s Gmail address, and fulfilled 

requests for documents that Rideaux passed along when the Company performed its 

due diligence of the transaction.   

22. At the inception of the scheme, in early 2020, Rideaux informed the 

Company CEO that he represented an individual named Ali Derakhshanfar, claiming 

that Derakhshanfar had access to a large amount of cash deposited at a bank in Qatar, 

because Derakhshanfar had won the trust of a Qatari sheikh.  While Rideaux used 

Derakhshanfar’s real name, he did not tell the Company CEO that Derakhshanfar was 

actually an insurance salesman who resided in California and had no connection to 

the Qatari royal family. 

23. The Defendants – led by Rideaux – effected the scheme by offering the 

Company $2 billion worth of “senior secured notes” to be issued by Gauntlet (the 

“Gauntlet Notes”).  As consideration for the Gauntlet Notes, Gauntlet was to receive 

convertible redeemable preferred shares in the Company, which provided the holders 

of those securities with dividends linked to transactions executed under the 

anticipated credit-linked note program.   

24. In a memorandum of understanding (“MOU”) dated June 16, 2020, 

Gauntlet and the Company agreed that the Company would obtain $1 billion of 

Gauntlet Notes in exchange for providing Gauntlet with convertible redeemable 

preferred stock.  The convertible redeemable preferred stock would pay a dividend 

linked to profits obtained from transactions under the anticipated credit-linked note 

program, with Gauntlet and the Company splitting the profits equally.  The June 16, 

2020 MOU expressly stated that the Gauntlet Notes were “fully backed by a pledged 

cash account” at the Qatari bank.  In a second MOU dated June 21, 2020, Rideaux 

(signing on behalf of Gauntlet), Derakhshanfar, and Ortiz agreed to split the profits 

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paid to Gauntlet, with 40% to Gauntlet and Rideaux, 40% to Derakhshanfar, and 20% 

to Ortiz (purportedly for Ortiz’s role in introducing and facilitating the exchange of 

information between certain of the parties to the agreement).  The June 16, 2020 

MOU was subsequently amended in an agreement dated July 30, 2020 to provide that 

Gauntlet would sell $2 billion worth of Gauntlet Notes in exchange for additional 

convertible redeemable preferred shares.  Similar to the June 16, 2020 MOU, the July 

30, 2020 agreement stated that the “Senior Secured Notes for an aggregate amount of 

Two Billion Dollars ($2,000,000,000.00) with the funds for such Notes to be 

deposited as collateral at the [Qatari bank].” 

25. The Gauntlet Notes each had a face value of $50 million, and each 

promised to pay its face value upon maturity in July 2030.  The Gauntlet Notes were 

purportedly backed by a “Security Interest,” defined as a “first priority security 

interest in the [USD] equivalent to the face value” of the note held at the Qatari bank, 

with a specific account number identified.  Each Gauntlet Note contained a paragraph 

titled “Investment Intent,” in which the holder of the note “warrants and represents 

that . . . any security issuable hereof will be acquired for investment only.”  In 

addition, each Gauntlet Note contained a heading that described the note as a security 

and stated that it had not been registered with the SEC or any state securities 

authority.  The Gauntlet Notes also each contained a paragraph titled “Transfer of this 

Note,” which provided as follows: 

Neither this note nor any of the rights, interests or obligations hereunder, shall 

be assigned, sold, pledged, transferred or otherwise disposed of except with the 

prior written consent of the Issuer and in compliance with the Securities Act of 

1933, as amended …, applicable state securities laws, and the Note Issuance 

Agreement. 

26. In February and March of 2021, the Company’s affiliate based in the 

United Kingdom transferred a total of $1 million USD by wire to its counsel in the 

United States.  The money was transferred to pay the Defendants and Ortiz an 

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“advance” on profits from the Company’s credit-linked note program to be backed by 

the Gauntlet Notes.  Excepting $15,000 that counsel retained, counsel distributed the 

$1 million to the Defendants and Ortiz.  

27. In truth, there were no funds backing the Gauntlet Notes, and the Qatari 

bank documents provided to the Company during the due diligence process appear to 

have been fabricated.  While the Gauntlet Notes listed an account number for the 

Qatari Bank Account, that account number did not exist and in any event, it did not 

match the format of account numbers used at the Qatari bank.  Moreover, financial 

records for the Qatari bank show that the total amount of money held at the bank that 

individual, non-entity account holders had deposited was less than the $7.98 billion 

that the Defendants claimed that Derakhshanfar could access in a single Qatari Bank 

Account purportedly belonging to the Sheikh. 

28. In addition, records reflecting IP address2 login information show that, 

on at least certain occasions, the Sheikh’s alleged Gmail address used to provide 

documentation supporting the existence of funds at the Qatari Bank Account was 

accessed at the exact same time and location where Derakhshanfar accessed his own 

Gmail account, indicating that the Gmail account for the “Sheikh” was, in fact, 

controlled by Derakhshanfar. 

C. Rideaux and Derakhshanfar Misled and Lied to the Company about the 

Alleged $7.98 Billion Bank Account in Qatar 

29. The Defendants were able to effect this scheme by manipulating through 

lies and omissions the Company CEO to believe that the Qatari Bank Account was 

real and that Derakhshanfar had access to it.  For example, Rideaux – recognizing 

that it might seem suspicious that a sheikh relied on a commonly used application 

such as Gmail – sought to preempt any concerns by explaining its use to the 

Company CEO: “While I was somewhat apprehensive of the gmail [sic] being used it 

 
2 An IP address is a unique string of characters that identifies a device on the internet or a local 
network.   

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is apparently understood and accepted by the Royal Family.  Please acknowledge 

receipt of this email and the understanding that Ali [Derakhshanfar] reports to [the] 

Shiek [sic] …”   

30. Rideaux also provided the Company and its counsel with a “bank 

confirmation letter” from an administrator at the Qatari bank, purportedly evidencing 

the account and confirming a $7.98 billion balance in the Qatari Bank Account.  

Rideaux further shared with the Company CEO and the counsel he retained 

screenshots of a bank statement reflecting a $7.98 billion balance in the Qatari Bank 

Account; the screenshots were attached to what appeared to be an email from the 

Qatari bank that the Sheikh’s Gmail address had purportedly forwarded to 

Derakhshanfar.   

31. To ensure the scheme’s success, the Defendants sought to quash any 

efforts to reach out directly to the Qatari bank to confirm the existence of these funds.  

On one occasion, when counsel the Company CEO retained attempted to reach out to 

a publicly-listed email for the Qatari bank, Rideaux expressed concern and upset, 

cautioning the Company that sending the email was a “breach in procedures” that 

“caused tremendous damage and may have consequences beyond repair.”  Before 

allowing further due diligence, Rideaux ordered the Company CEO to send an 

apology to the Sheikh’s Gmail address, which he did, and his counsel sent an 

additional apologetic email to that email account.   

32. In fact, even as these apologies were made, the Defendants were 

fabricating documents in furtherance of the scheme.  On July 21, 2020, the Sheikh’s 

Gmail address sent an email to counsel the Company CEO had retained attaching two 

letters, one on “State of Qatar” stationery and the other on stationery from the Qatari 

bank.  Both letters attested to the validity of a bank comfort letter, bank statements, 

and screenshots showing an account balance and confirmed that Derakhshanfar was 

the owner of an account identified by a specific account number.  Further, on August 

3, 2020, the Sheikh’s Gmail address sent an email to the Company CEO and his 

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counsel.  The Gmail message attached a letter printed on “State of Qatar” stationery 

and the letter vouched for Derakhshanfar as a “fiduciary” for the Sheikh.  However, 

email traffic between the Defendants shows that Rideaux drafted the language of the 

“Sheikh’s” Gmail message and provided it to Derakhshanfar. 

33. Rideaux’s manipulation of the Company CEO is further evidenced in 

communications concerning a press release the Company CEO had hoped to issue.  In 

August 2020, the Company CEO sent Rideaux a draft press release, noting that the 

Sheikh, on behalf of the Qatari royal family, had invested $2 billion in the Company.  

Rideaux responded, rewriting the draft press release to remove any mention of the 

Qatari royal family, telling the Company CEO that any mention of the royal family 

would be in violation of a non-disclosure agreement.  In truth, Rideaux sought to 

avoid any mention of the royal household because there was no actual investment of 

$2 billion from the Qatari royal family. 

34. Rideaux further projected a false air of legitimacy by touting his 

purported ties to Qatari royalty.  In a January 2021 email to the Company CEO, 

Rideaux forwarded a Los Angeles Times article entitled “The true story of the 

heartthrob prince of Qatar and his time at USC.”  The article described the conduct of 

a member of the Qatari royal family (not the “Sheikh” who purportedly entrusted 

money to Derakhshanfar) while he was a student at the University of Southern 

California.  Rideaux – a former football player at USC who played with the team in 

the 2003 Orange Bowl – told the Company CEO that “[t]his is how I came to meet 

[Derakhshanfar] and the [royal family of Qatar].”  In fact, Rideaux graduated from 

USC several years before the Qatari prince arrived on the campus. 

35. In addition to touting his own purported ties to the Qatari royal family, 

Rideaux continued to tout Derakhshanfar’s ties to Qatari royalty.  In a February 22, 

2021 letter to the Company CEO, Rideaux said, in relevant part: “Mr. Derakhshanfar, 

who has had an account at [the Qatari bank] since 2013; is a sovereign fund manager 

who has a close relationship to members of the … Royal Family of Qatar.” 

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D. The Defendants Obtained $1 Million Through the Qatari Bank Scheme 

36. In February 2021, the Company’s affiliate in the United Kingdom made 

an initial $250,000 payment that was divided among the Defendants.  Derakhshanfar 

received $175,000, Rideaux received $30,000, and Ortiz received $30,000, with the 

remaining $15,000 going to the Company’s attorney.  In mid-March 2021, the 

Company’s affiliate in the United Kingdom paid the remaining $750,000 to the 

Defendants.  This time, Rideaux received $212,500, Derakhshanfar received 

$325,000, and Ortiz received $112,500, with the remaining $100,000 going to 

Derakhshanfar’s attorney.   

E. Overview of the Second Scheme by Rideaux and Gauntlet 

37.   In early 2024, Rideaux connected with Investor A through the 

WhatsApp communications application, where Rideaux pitched Investor A on a 

potential investment opportunity in which Investor A’s money would be pooled with 

other investors to purchase asset-backed securities.  Through messages exchanged 

with Rideaux, Investor A received a one-page document describing a “Special 30-

Day Small Cap Program,” stating that the program was “[b]y invitation only.  200% 

return after 30 Days.  1M Minimum/ 5M maximum.”   

38. In March 2024, Rideaux met with Investor A on Zoom, along with a 

mutual acquaintance who had introduced the two.  Rideaux told Investor A during the 

meeting that he had worked for a prominent broker-dealer in the U.S., that he was a 

financial adviser for wealthy clients, and that he had made millions for those clients. 

In describing his professional background, Rideaux omitted the fact that since 2018 

he had been barred from associating with any FINRA member (including any broker-

dealer) after an investigation into potential securities law violations at his prior firm.  

39. During the March 2024 meeting with Investor A, Rideaux displayed a 

flow chart that purported to show how investor funds would be used by Gauntlet to 

“[p]urchase security and receive monthly pass-through of principal and interest from 

borrowers.”  The chart showed that funds from investors would flow to Gauntlet, 

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which would then use the funds to purchase loans from issuers.  Rideaux reiterated 

that Investor A could invest with Gauntlet and receive 200% returns within 30 days. 

40. Investor A, Rideaux, and others executed a written “Joint Venture / 

Partnership Management Agreement” that described an “Investment Offer” involving 

a $1 million investment to be sent to an escrow account.  The agreement 

contemplates an investment that lasts 10 banking days promising a return of 50% 

derived from an investment strategy executed by a firm Rideaux’s brother-in-law 

purportedly managed.  Investor A’s obligation was limited to sending $1 million to 

the escrow account, and Investor A was assured that, with respect to the way the 

investment works, “the principal remains in the non-depletion account.”  The 

agreement specified that information about the investment opportunity would be 

presented to other investors, “especially private accredited investors seeking high-

yield returns uncorrelated to the stock market.”  The contract terms gave Investor A 

the ability to terminate the contract via writing or electronic mail and further provided 

that Gauntlet and others “shall earn profits net of distributions” to Investor A. 

41. Between March 22 and March 25, 2024, Investor A transferred $1 

million to Rideaux’s attorney’s trust account to be invested with Gauntlet. 

F. Rideaux Makes Numerous Misstatements to Investor A 

42. Notwithstanding the provision in the “Joint Venture / Partnership 

Management Agreement” specifying that funds would not be transferred, Investor 

A’s money was quickly wired out of the escrow account.  Further, notwithstanding 

the provision in the agreement specifying that Gauntlet would earn profits net of 

distributions to Investor A, Rideaux and other Gauntlet employee received Investor 

A’s money without Investor A receiving any distributions. 

43. In April 2024, after 30 days elapsed, Investor A began what would 

ultimately be a months-long and failed quest to get his money back.  Investor A 

called, emailed, and sent WhatsApp messages to Rideaux, who responded with 

misrepresentations and omissions to lull Investor A into a false sense of security. 

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44. For example, on June 20, 2024, Rideaux sent Investor A an email titled: 

“Video from Gauntlet Family Office.”  The email assured Investor A that his funds 

were safe and claimed that Investor A’s principal would be returned shortly.  Rideaux 

attached to the email the video referenced in the subject line, which showed an online 

bank account with a balance of $1.75 million.  However, that account did not belong 

to Gauntlet, but to an Arizona-based entity.  Rideaux appears to have obtained online 

access to the Arizona-based entity’s bank account through an agreement nearly 

identical to the “Joint Venture / Partnership Management Agreement” Gauntlet 

executed with Investor A.  In the agreement, Rideaux promised the Arizona-based 

entity a return on its capital if the Arizona-based entity kept money in its account and 

gave Rideaux online access.  Rideaux used this access to take a video of the account 

to send to Investor A in an effort to assure Investor A that his funds were safe.  In 

fact, the funds in the account were completely unrelated to Gauntlet or Investor A’s 

investment. 

45. Investor A continued to communicate with Rideaux through various 

means over the following weeks, including WhatsApp, texts, emails, and calls to 

Gauntlet’s office and Rideaux’s cell phone.  Rideaux responded with a variety of 

misleading statements about the safety and expected return of Investor A’s $1 million 

investment with Gauntlet.  Among other things, Rideaux periodically sent Investor A 

photographs of what purported to be stacks of cash in wrappers from the bank as 

evidence that he was in possession of substantial funds.  At other times, Rideaux sent 

visual evidence of his excuses for delays, such as a GPS image of his whereabouts, or 

a photo of him on a plane in order to justify to Investor A why Rideaux was 

unavailable to discuss the status of the $1 million investment. 

46. On July 19, 2024 – almost three months after Gauntlet was required to 

return his principal with interest – Investor A emailed Rideaux pleading for an update 

on the status of his investment: “I’ve tried to call you and text you… but without any 

answer or feedback.  You promised me that you [would] transfer USD 1.435 million 

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from your [bank] to [your lawyer’s] account on Wednesday morning as the payback 

of my investment.  … Could you get back to me [with] the update ASAP?”   

47. As of today’s date, Investor A has not received any principal or interest 

from Rideaux and/or anyone associated with Gauntlet. 

FIRST CLAIM FOR RELIEF 

Fraud in the Connection with the Purchase and Sale of Securities 

Violations of Section 10(b) of the Exchange Act and Rule 10b-5 

(against Defendants Gauntlet, Rideaux, and Derakhshanfar) 

48. The SEC realleges and incorporates by reference paragraphs 1 through 

47 above. 

49. During the Relevant Period, the Gauntlet Notes were securities under 

Section 3(a)(10) of the Exchange Act, 15 U.S.C. §78c(a)(10). 

50. By engaging in the conduct described above, Defendants Gauntlet, 

Rideaux, and Derakhshanfar, directly or indirectly, in connection with the purchase or 

sale of a security, by the use of means or instrumentalities of interstate commerce, of 

the mails, or of the facilities of a national securities exchange:  (a) employed devices, 

schemes, or artifices to defraud; (b) made untrue statements of a material fact or 

omitted to state a material fact necessary in order to make the statements made, in the 

light of the circumstances under which they were made, not misleading; and (c) 

engaged in acts, practices, or courses of business which operated or would operate as 

a fraud or deceit upon other persons. 

51. By engaging in the conduct described above, Defendants Gauntlet, 

Rideaux, and Derakhshanfar violated, and unless restrained and enjoined will 

continue to violate, Section 10(b) of the Exchange Act, 15 U.S.C. §78j(b), and Rules 

10b-5(a), 10b-5(b), and 10b-5(c) thereunder, 17 C.F.R. §§240.10b-5(a), 240.10b-5(b) 

& 240.10b-5(c). 

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SECOND CLAIM FOR RELIEF 

Fraud in the Offer or Sale of Securities 

Violations of Section 17(a) of the Securities Act 

(against Defendants Gauntlet, Rideaux, and Derakhshanfar) 

52. The SEC realleges and incorporates by reference paragraphs 1 through 

47 above. 

53. During the Relevant Period, the Gauntlet Notes were securities under 

Section 2(a)(1) of the Securities Act, 15 U.S.C. §77b(a)(1). 

54. By engaging in the conduct described above, the Defendants, directly or 

indirectly, in the offer or sale of securities, and by the use of means or instruments of 

transportation or communication in interstate commerce or by use of the mails 

directly or indirectly:  (a) employed devices, schemes, or artifices to defraud; (b) have 

obtained money or property by making untrue statements of material fact or omitting 

material facts necessary to make the statements not misleading; and/or (c) engaged in 

transactions, practices, or courses of business which operated or would operate as a 

fraud or deceit upon the purchaser. 

55. Defendants, with scienter, employed devices, schemes and artifices to 

defraud; and with scienter or negligence, engaged in transactions, practices, or 

courses of business which operated or would operate as a fraud or deceit upon the 

purchaser. 

56. By engaging in the conduct described above, Defendants violated, and 

unless restrained and enjoined will continue to violate, Sections 17(a)(1), 17(a)(2), 

and 17(a)(3) of the Securities Act, 15 U.S.C. §§ 77q(a)(1), (2) and (3). 

THIRD CLAIM FOR RELIEF 

Other Equitable Relief, Including Unjust Enrichment  

and Constructive Trust 

(against Relief Defendant Ortiz) 

57.   The Commission realleges and incorporates by references paragraphs 1 

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through 47 as if fully set forth herein. 

58. Section 21(d)(5) of the Exchange Act states, “In any action or 

proceeding brought or instituted by the Commission under any provision of the 

securities laws, the Commission may seek, and any Federal court may grant, any 

equitable relief that may be appropriate or necessary for the benefit of investors.” 

59. Relief Defendant Ortiz received ill-gotten funds provided by the 

Company for purposes of investment with the Defendants.  Relief Defendant has no 

legitimate claim to this property.  In equity and good conscience, Relief Defendant 

should not be allowed to retain such funds. 

60. As a result, Relief Defendant is liable for unjust enrichment and should 

be required to return the ill-gotten gains, in an amount to be determined by the Court.  

The Court should also impose a constructive trust on the ill-gotten gains in the 

possession of the Relief Defendant. 

FOURTH CLAIM FOR RELIEF 

Fraud in the Connection with the Purchase and Sale of Securities 

Violations of Section 10(b) of the Exchange Act and Rule 10b-5 

(against Defendants Gauntlet and Rideaux) 

61. The SEC realleges and incorporates by reference paragraphs 1 through 

47 above. 

62. During the Relevant Period, the securities offered to Investor A were 

securities under Section 3(a)(10) of the Exchange Act, 15 U.S.C. §78c(a)(10). 

63. By engaging in the conduct described above, Defendants Gauntlet and 

Rideaux, directly or indirectly, in connection with the purchase or sale of a security, 

by the use of means or instrumentalities of interstate commerce, of the mails, or of 

the facilities of a national securities exchange:  (a) employed devices, schemes, or 

artifices to defraud; (b) made untrue statements of a material fact or omitted to state a 

material fact necessary in order to make the statements made, in the light of the 

circumstances under which they were made, not misleading; and (c) engaged in acts, 

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practices, or courses of business which operated or would operate as a fraud or deceit 

upon other persons. 

64. By engaging in the conduct described above, Defendants Gauntlet and 

Rideaux violated, and unless restrained and enjoined will continue to violate, Section 

10(b) of the Exchange Act, 15 U.S.C. §78j(b), and Rules 10b-5(a), 10b-5(b), and 10b-

5(c) thereunder, 17 C.F.R. §§240.10b-5(a), 240.10b-5(b) & 240.10b-5(c). 

FIFTH CLAIM FOR RELIEF 

Fraud in the Offer or Sale of Securities 

Violations of Section 17(a) of the Securities Act 

(against Defendants Gauntlet and Rideaux) 

65. The SEC realleges and incorporates by reference paragraphs 1 through 

47 above. 

66. During the Relevant Period, the securities offered to Investor A were 

securities under Section 2(a)(1) of the Securities Act, 15 U.S.C. §77b(a)(1). 

67. By engaging in the conduct described above, the Defendants, directly or 

indirectly, in the offer or sale of securities, and by the use of means or instruments of 

transportation or communication in interstate commerce or by use of the mails 

directly or indirectly:  (a) employed devices, schemes, or artifices to defraud; (b) have 

obtained money or property by making untrue statements of material fact or omitting 

material facts necessary to make the statements not misleading; and/or (c) engaged in 

transactions, practices, or courses of business which operated or would operate as a 

fraud or deceit upon the purchaser. 

68. Defendants, with scienter, employed devices, schemes and artifices to 

defraud; and with scienter or negligence, engaged in transactions, practices, or 

courses of business which operated or would operate as a fraud or deceit upon the 

purchaser. 

69. By engaging in the conduct described above, Defendants violated, and 

unless restrained and enjoined will continue to violate, Sections 17(a)(1), 17(a)(2), 

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and 17(a)(3) of the Securities Act, 15 U.S.C. §§ 77q(a)(1), (2), and (3). 

PRAYER FOR RELIEF 

WHEREFORE, the SEC respectfully requests that the Court: 

I. 

Issue judgments, in forms consistent with Rule 65(d) of the Federal Rules of 

Civil Procedure, permanently enjoining Defendants and their agents, servants, 

employees and attorneys, and those persons in active concert or participation with 

any of them, from directly or indirectly engaging in the conduct described above, or 

in conduct of similar purpose or effect, in violation of Section 17(a) of the Securities 

Act [15 U.S.C. §77q(a)], and Section 10(b) of the Exchange Act [15 U.S.C. §§78j(b)] 

and Rule 10b-5 thereunder [17 C.F.R. §240.10b-5]. 

II. 

Order Defendants to disgorge all ill-gotten gains from the conduct alleged 

herein, with prejudgment interest, pursuant to Section 21(d)(5) of the Exchange Act 

[15 U.S.C. §78u(d)(5)]. 

III. 

Order Defendants to pay civil penalties under Section 20(d) of the Securities 

Act [15 U.S.C. §77t(d)] and Section 21(d)(3) of the Exchange Act [15 U.S.C. 

§78u(d)(3)]. 

IV. 

Order the Relief Defendant to disgorge all ill-gotten gains or unjust 

enrichment, with prejudgment interest thereon, to effect the remedial purposes of the 

federal securities laws. 

V. 

Retain jurisdiction of this action in accordance with the principles of equity and 

the Federal Rules of Civil Procedure in order to implement and carry out the terms of 

all orders and decrees that may be entered, or to entertain any suitable application or 

motion for additional relief within the jurisdiction of this Court. 

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VI. 

Grant such other and further relief as this Court may determine to be just and 

necessary. 
 

Dated:  March 13, 2025 /s/  Kathryn Wanner 
KATHRYN WANNER 
RUA M. KELLY (pro hac vice pending) 
JONATHAN T. MENITOVE (pro hac 
vice pending) 
Attorneys for Plaintiff 
Securities and Exchange Commission 
 
 

  
 
 

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	A. Overview of the Qatari Bank Scheme
	B. The Defendants Schemed to Convince the Company That They Had Access to Billions in a Qatari Bank Account Through Derakhshanfar.
	C. Rideaux and Derakhshanfar Misled and Lied to the Company about the Alleged $7.98 Billion Bank Account in Qatar