1 

UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF OHIO

EASTERN DIVISION

 

 ) 

SECURITIES AND EXCHANGE COMMISSION, ) 

 ) 

 Plaintiff, ) CASE NO. 23-CV-1853 

v. ) 

 ) 

MATTHEW M. MOTIL ) 

NORTH SHORE EQUITY SALES, LLC, d/b/a ) JURY DEMANDED 

THE MARIE PAUL COMPANY; )

NORTH SHORE EQUITY MANAGEMENT, LLC; ) 

 ) 

 Defendants, ) 

 ) 

AMY DOUBRAVA MOTIL, ) 

 ) 

Relief Defendant. ) 

 ) 

COMPLAINT

 

Plaintiff, the Securities and Exchange Commission (“SEC”), alleges as follows: 

SUMMARY

1. For almost four years, Matthew M. Motil (“Motil”) devised and carried out an 

offering fraud and Ponzi scheme that defrauded investors of millions of dollars. He promised 

investors short-term, low-risk, and high-return promissory notes supposedly fully collateralized by 

first mortgages on residential real estate located throughout Ohio. Motil falsely told investors that 

he would use their investments to renovate the properties and pay them back with profits from

reselling the properties, refinancing them, or renting them. Nearly everything about his scheme 

was a lie. Many of the promissory notes he offered and sold to investors were not “fully 

collateralized by first mortgages” because Motil purposely issued multiple promissory notes 

“secured” by the same property to numerous investors. 

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2. In one instance, Motil obtained over $1.3 million from at least twenty separate 

investors, issuing at least twenty notes “secured” by one single-family home that was purchased 

for $47,000 and never valued at more than $130,000. Despite promising many investors that he 

would record their mortgages, Motil failed to do so. Ultimately, Motil used investor funds to (1) 

make over $3.7 million in Ponzi payments; (2) spend over $1.6 million on personal expenses; (3)

divert over $900,000 of investors’ money to other businesses unrelated to real estate, and (4) route

hundreds of thousands more to his wife, Amy Doubrava Motil (“Amy Motil” or “Relief 

Defendant”). Motil intentionally or recklessly failed to disclose any of this to his investors.

3. From as early as October 2017 through May 2021 (the “Relevant Period”), Motil, 

operating through North Shore Equity Sales, LLC d/b/a The Marie Paul Company (“NS Sales”), 

North Shore Equity Management, LLC (“NS Management”) and a variety of other LLCs that he 

created, raised over $11 million from more than 60 investors located across the United States. 

Motil persuaded individuals, including a cancer researcher and an active-duty U.S. Air Force 

Lieutenant Colonel, to invest their retirement funds and life savings with him by advertising his 

own financial acumen and track record of success.

4. After Motil’s Ponzi scheme collapsed, he filed for personal bankruptcy in March 

2022, seeking to discharge the millions of dollars he personally owed to the investors he had 

victimized. In his bankruptcy petition, Motil failed to divulge that his debts were from his Ponzi 

scheme. Instead, Motil identified the victimized investors as his “creditors,” claiming that his

personal debts arose from “guarantees of debts of [Motil] LLCs.” However, in response to the 

Amended Complaint filed by the U.S. Trustee in its adversarial proceeding, Motil contended that 

the victim-creditors of his Ponzi scheme are creditors of corporations and LLCs that Motil owned. 

5. Motil actively participated in his bankruptcy case but has ignored numerous SEC 

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administrative subpoenas for testimony and documents served upon him personally. 

6. As a result of the conduct described in this Complaint, the Defendants violated 

Sections 5(a) and (c) and 17(a) of the Securities Act of 1933 (“Securities Act”), [15 U.S.C. §§ 

77e(a), (c), and 77q(a)]; and Section 10(b) and Rule 10b-5 of the Securities Exchange Act of 1934 

(“Exchange Act”), [15 U.S.C. § 78j(b) and 17 C.F.R. §240.10b-5]. Unless restrained and enjoined, 

they are reasonably likely to continue to violate the federal securities laws. 

7. The Commission seeks a judgment from the Court: (i) permanently enjoining the 

Defendants from violating the applicable provisions and rules of the federal securities laws as 

alleged and asserted below; and from participating directly or indirectly in the issuance, purchase, 

offer or sale of any security (provided that such order would not prevent Defendants from buying 

and selling securities listed on a national securities exchange for their respective personal 

accounts); (ii) barring Motil from becoming an officer or director of a public company; (iii) 

directing the Defendants to disgorge all net profits they received as a result of the acts and/or 

courses of conduct complained of, with prejudgment interest; (iv) directing the Defendants to pay 

civil money penalties; (v) creating a Fair Fund pursuant to Section 308(a) of the Sarbanes-Oxley 

Act; (vi) ordering Relief Defendant to disgorge any ill-gotten gains plus prejudgment interest 

thereon; and (vii) granting such other and further relief as this Court may determine to be just, 

equitable, and necessary. 

JURISDICTION AND VENUE

8. The SEC brings this action pursuant to Section 20(b) of the Securities Act [15 

U.S.C. §77t(b)], and Sections 21(d) and 21(e) of the Exchange Act [15 U.S.C. §§78u(d) and 

78u(e)]. In connection with the conduct described herein, Defendants directly or indirectly made 

use of the means or instrumentality of interstate commerce, or of the mails, in connection with 

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their actions as alleged in this Complaint. Throughout the Relevant Period, Defendants solicited 

and received funds from investors throughout the United States by interstate wire transfers, and 

Motil communicated with and solicited out of state investors via his website, various social media 

accounts, and/or by telephone and e-mail. 

9. Venue is proper in this Court pursuant to Section 27 of the Exchange Act [15 U.S.C. 

§ 78aa]. Motil and Amy Motil reside and can be found in this District, and certain of the acts, 

practices and courses of business constituting the violations alleged herein occurred within this 

District. Specifically, many of the residential real estate properties involved in Motil’s fraud are 

located within this District.

DEFENDANTS 

10. Motil, age 42, is a resident of North Olmsted, Ohio, and is the owner and principal 

of NS Sales and NS Management and each related party described below. Motil is an Ohio-licensed 

Professional Engineer, and a self-described entrepreneur and real estate expert. Motil holds a Ph.D. 

and an MBA, and has claimed to have a J.D. majoring in Intellectual Property, earned in one year 

from the University of Akron School of Law. Motil created and controlled numerous bank 

accounts at JPMorgan Chase Bank NA in the names of NS Sales, NS Management, the related 

parties (and others) that he used to facilitate the fraudulent scheme described herein (each a “Chase 

Account” and collectively the “Chase Accounts”). On March 7, 2022, Motil filed a voluntary 

petition under Chapter 7 of the Bankruptcy Code for personal bankruptcy in the Bankruptcy Court 

for the Northern District of Ohio. 

11. NS Sales is an Ohio LLC created and controlled by Motil with its principal place 

of business in Ohio. NS Sales also used a number of registered trade names including “The Marie 

Paul Company.” NS Sales held properties and issued promissory notes to investors that contained 

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materially false and misleading statements and/or omissions. Motil instructed investors to deposit 

their money into a Chase Account in the name of NS Sales. Motil used the funds in the NS Sales 

Chase Account for personal expenditures, as well as to make payments due to previous investors

(“Ponzi Payments”) and to businesses unrelated to real estate. NS Sales is not registered with the 

Commission in any capacity. 

12. NS Management is an Ohio LLC created and controlled by Motil with its principal 

place of business in Ohio. Like NS Sales, NS Management held properties and issued promissory 

notes to investors that contained materially false and misleading statements and/or omissions. 

Motil also requested that some investors transfer their money to a Chase Account in the name of 

NS Management. Motil used the funds in the NS Management Chase Account for personal 

expenditures, as well as to make Ponzi Payments and payments to businesses unrelated to real 

estate. Motil also transferred investor funds from the Chase Account in the name of NS Sales to 

the Chase Account in the name of NS Management, where it was used to make Ponzi Payments, 

to pay personal expenses and make payments to businesses unrelated to real estate. 

RELIEF DEFENDANT

13. Amy Motil, age 35, is married to Motil and resides in North Olmsted, Ohio. Certain 

banking records list Amy Motil as “COO” and 50% owner of NS Sales, and as a “Member” of NS 

Management. Amy Motil received at least $400,000 of investor money. 

RELATED PARTIES

14. BUYCLE112, LLC; BUYCLE114, LLC; BUYCLE158, LLC; BUYCLE175, LLC; 

BUYCLE176, LLC; INVCLE150, LLC; NS Equity Cleveland, LLC; NSEM Mansfield 1, LLC; 

and NSEM Mansfield 2, LLC (each a “Motil LLC” and together “the Motil LLCs”) are all Ohio 

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LLCs that were created and controlled by Motil. The Motil LLCs held real estate and/or issued 

promissory notes that contained materially false and misleading statements and/or omissions. 

FACTS 

I. Motil’s Solicitation Efforts

15. During the Relevant Period, Motil described himself as a self-made real estate 

entrepreneur who helped “hundreds of investors throughout the world to create massive wealth 

through real estate.” He advertised himself using his website at http://www.drmattmotil.com (the 

“Motil Website”) and numerous social media accounts (including accounts at Facebook, LinkedIn 

and Biggerpockets.com) and podcasts. 

16. The Motil Website told prospective investors that Motil had “investment 

opportunities ranging from $10,000 to $10 million,” and invited those who visited the website to 

“Be a Real Estate Investing Badass!” and to “fire [their] boss, quit [their] 9 to 5, and build a 

business/lifestyle [they] love earning a passive income from real estate investments.” The Motil 

Website and Motil’s social media accounts offered links to podcasts on Apple and YouTube 

entitled “The Cash Flow King, The Realest Real Estate Podcast,” hosted by “Doctor Motil.” 

17. A former employee of Motil testified under oath that they believed that the podcast 

was part of a broader media presentation to convince people to invest with Motil and his 

companies. Motil released approximately 147 episodes of the podcast. 

18. In one podcast dated November 8, 2019 titled “Funding Back Private Money,” 

Motil talked at length about the “huge level of responsibility” that comes with accepting real estate 

investments from individuals. He said: 

When someone has worked at a job or a business . . . there’s a 

significant level of effort that has gone into the creation of that 

capital. And so when [people] are willing to take that [money] and 

hand it to you in good faith, [there’s an obligation] that you’re going 

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to turn it around and give them a nice return on their money. They 

have put a lot of faith in you. And you have a significant level of 

responsibility to make sure that, not only are you doing what you 

said you were going to do, but you give them the return that you 

promised. . . . [w]e don’t do unsecured notes so . . . we’re doing a 

promissory note and a mortgage, one investor-one deal and so 

you’re first lien position on the property, just like a bank. 

(emphasis added). When Motil made this statement, which he knew or recklessly failed to know 

was false, he had already defrauded numerous investors; after making this statement, he continued 

to defraud investors for well over a year. 

19. Through the Motil Website and certain social media accounts he controlled, Motil 

invited visitors to submit their e-mail address to receive copies of his newsletter and to schedule a 

call to speak with him directly. Once investors signed up for the newsletter or scheduled a phone 

call, Motil typically solicited them directly by e-mail with “private lending opportunities” that

briefly described, in bullet-point format, several promissory notes. 

20. The descriptions included: (i) their principal amounts; the applicable annual 

percentage rate (“APR”) (usually 8%-15%); (ii) the term (usually 6-18 months); and sometimes 

(iii) a brief description of the residential property that would collateralize the promissory note 

(such as the number of bedrooms and baths and a property valuation estimate). Motil does not 

appear to have attempted to screen accredited investors. 

21. In his conversations with investors, Motil often told them, among other things, that 

he bought houses, renovated them, and either sold them at a profit or refinanced them and rented 

them. He often emphasized that investors would play an entirely passive role and they would not

need to participate in the renovation, rental or refinancing of the property. Motil told multiple 

investors that they essentially would be “acting as a bank” because their funds would be secured 

by a first position mortgage lien on the property and they would receive interest payments and, at 

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the end of the term, their principal. Motil knew or recklessly failed to know that this was false. 

Motil also told investors on numerous occasions (sometimes in writing and sometimes orally) that 

after he received their investment he would record the mortgage with the county clerk, knowing 

or recklessly failing to know that this was false. 

II. The Investments Offered By Motil

22. After an investor selected a particular investment from among Motil’s list of 

“private lending opportunities,” Motil created and issued a promissory note corresponding to the 

investor’s choice (the “Notes”). The Notes set forth, among other things, the APR, the repayment 

schedule, the address of the property that would purportedly collateralize the Note, and the name 

of the entity (usually a Motil LLC, but sometimes NS Sales or NS Management) that Motil 

identified as the borrower. Motil signed the Notes on behalf of the borrower.

23. Motil also sent investors a document he created titled “Mortgage.” The mostlyboilerplate language in the Mortgages generally contained covenants prohibiting Motil from 

creating or accruing any debt, lien or charge that would have priority over the Note received by 

the investor. The covenants in the Mortgages underscored what Motil told many investors orally: 

their investments were collateralized by first position mortgages on residential properties. 

24. In addition to the Notes and Mortgages, Motil also sent payment instructions for 

investors to fund their Note. Motil typically instructed investors to send their money to a Chase 

Account. Motil specifically told numerous investors that after he received their money he would 

record the mortgage and they would receive a signed copy of the recorded mortgage mailed 

directly from the appropriate county clerk. 

25. Motil often told investors that the county clerks were backlogged and that it took 

several weeks or months to send their recorded mortgages. But Motil was just buying time. He 

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knew that county clerks could not possibly mail a copy of the recorded mortgages because, among 

other things, Motil rarely recorded the mortgages. In fact, Motil admitted under oath during his 

Section 341(a) bankruptcy hearing, that he only recorded mortgages “a couple times, if . . . asked.” 

26. Motil’s failure to record the mortgages not only contradicted his written and oral 

assurances to investors, it also enabled Motil to sell multiple Notes “collateralized” by the same 

property to different investors. If prospective investors searched county title records, they would

be unable to discover that the property purportedly collateralizing their investment was already 

encumbered by a mortgage. Motil knew, or was reckless in not knowing, that the properties were 

not secured by first mortgages simply because there could only be one first mortgage, and, in many 

instances, Motil had already issued mortgages on the same property to numerous investors. 

III. Motil Forged A Notary’s Signature and Misused A Notary Seal On Investors’ 

Mortgages 

27. In October 2018, Motil hired an assistant who was tasked with, among other things, 

obtaining a notary commission and notarizing mortgage agreements. The assistant carried out her 

task of notarizing mortgages until September 2019, when Motil gave her a new assignment.

28. Motil then forged her signature as a notary and affixed a counterfeit version of her 

notary seal to mortgages. Beginning in approximately September 2019, Motil forged the notary’s 

signature and affixed her seal on at least thirty mortgages. This continued even after the notary left 

Motil’s employ in February 2020. By forging her signature and falsely affixing her seal, Motil 

intentionally or recklessly caused the mortgages to become un-recordable under Ohio law. Motil 

intentionally or recklessly failed to tell investors that he was forging a notary’s signature and seal 

on their “mortgages.” This omission was material because a reasonable investor would have 

wanted to know that Motil – the expert “Cash Flow King” who had helped hundreds of investors, 

in whom they were placing their trust – was falsifying a notary’s stamp and signature on official 

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documents.

29. Motil’s former employee filed a formal police report after she learned that he had 

forged her signature and used a counterfeit version of her notary seal.

IV. Motil Misled Investors By Failing to Disclose That He Sold Multiple Notes Secured 

by Single Properties

30. Motil intentionally sold multiple Notes, each supposedly collateralized by a single 

property, to dozens of investors, defrauding them of millions of dollars. 

31. From November 2017 to May 2021, Motil sold Notes that were all purportedly 

collateralized by the same residential property located at 13410 Wainfleet Avenue in Cleveland 

(the “Wainfleet Property”) to at least fifteen separate investors,. Though Motil acquired the 

Wainfleet Property (through a Motil LLC) in November 2017 for only $35,000, he used the 

property to “collateralize” Notes worth at least $502,971. When Motil sold his last Wainfleet 

Property Note, he owed at least $393,000 to at least 12 investors, bringing the total outstanding 

principal to $433,000. At the time, home valuation services Corelogic, Quantarium, and Collateral 

Analytics valued the Wainfleet Property at between $60,745 and $76,000. 

32. Similarly, Motil intentionally or recklessly sold Notes that were all purportedly 

collateralized by the same single-family residence located at 13529 Leroy Avenue in Cleveland 

(the “Leroy Property”) to at least seventeen investors. Though Motil bought the Leroy Property 

(through a Motil LLC) in August 2017 for $51,000, he used the property to “collateralize” Notes 

worth at least $853,000. When Motil sold his last Note purportedly collateralized by the Leroy 

Property in April 2021, he owed over $610,000 to 12 investors, bringing the total outstanding 

principal to over $635,000. Corelogic, Quantarium, and Collateral Analytics never valued the 

property at more than $118,600. 

33. Beginning in November 2019, Motil intentionally or recklessly sold Notes that 

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were all purportedly collateralized by the same multi-family property located at 4027 Rocky River 

Drive, in Cleveland (the “Rocky River Property”) to at least ten investors. Motil bought the Rocky 

River Property (through a Motil LLC) in December 2018 for $931,000, but used it to 

“collateralize” Notes worth over $2.6 million. By May 2020, when Motil sold his last Note

“collateralized” by the Rocky River Property, he owed investors in the property a total of over 

$2.2 million. One of Motil’s investor victims, Investor A, lost approximately $429,240 from her 

IRA account on the Rocky River Property alone. (See infra ¶¶ 42-47).

34. Beginning in November 2017, Motil intentionally or recklessly sold Notes that

were all purportedly collateralized by the same property located at 3318 Hearthstone Road in 

Parma, Ohio, (the “Hearthstone Property”) to at least twenty investors. Motil bought the 

Hearthstone Property in November 2017 for only $47,000, but by January 2021, had used it to 

“collateralize” notes worth over $1.3 million. Corelogic, Quantarium, and Collateral Analytics 

never valued the property as worth more than $130,000. When Motil sold his last note on the 

Hearthstone Property, he owed investors in the property a total of over $1.1 million.

35. Beginning in September 2019, Motil intentionally or recklessly sold Notes that 

were all purportedly collateralized by the same property located at 3593 West 50th Street in 

Cleveland, Ohio (the “W 50th Street Property”) to at least ten investors. He bought the W 50th

Street Property in September 2019 for only $30,000, but by January 2021, had used it to 

“collateralize” notes worth over $330,000. By January 2021, Motil owed investors approximately 

$307,000.

36. Motil intentionally or recklessly failed to tell investors in the Wainfleet, Leroy, 

Rocky River, Hearthstone, and W 50th Street Properties that he had already sold multiple Notes on 

the same properties. And he intentionally or recklessly failed to inform investors that he intended 

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to continue to encumber the already-overburdened properties with additional “mortgages.” 

37. These misstatements – and Motil’s failures to disclose to investors that there were 

already existing liens on these properties – were material. Reasonable investors would have wanted 

to know that these properties were grossly over-leveraged and that other investors were already 

promised a share of whatever “profits” Motil expected to earn. 

V. Motil Misused Investors’ Funds on Ponzi Payments and Personal Expenses

38. Motil intentionally misappropriated the funds transferred by investors to the Chase 

Accounts by making Ponzi payments, moving money to businesses unrelated to real estate, and 

paying personal expenses. Overall, during the Relevant Period, Motil raised over $11 million from 

unsuspecting investors. He used over $3.7 million (or 33%) on Ponzi payments; over $900,000 

(9%) on transfers to other businesses unrelated to real estate, $400,000 on transfers to his wife, 

and $1.6 million on personal expenses. 

39. These personal expenses included over $1,000,000 in personal credit card charges, 

over $107,000 on a seven-month rental of a lakeside mansion; over $73,000 for courtside seats to 

the Cleveland Cavaliers; over $45,000 to repay student loans; over $37,000 on purchases from 

Best Buy; over $23,000 on “Leeny’s Lean Body”; over $22,000 on iTunes, over $14,000 at 

Starbucks; over $13,900 at numerous pizzerias; and $58,000 in cash withdrawals. Motil never 

disclosed that any investor funds would be used on Ponzi payments, on unrelated businesses, or 

on personal expenses, let alone approximately 60% of investor money. 

40. Without a constant inflow of new money from investors, Motil’s operations were 

unsustainable because the cash income from his real estate business operations was insufficient to 

make payments due to investors, make payments to other businesses, and to pay personal expenses. 

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VI. Specific Examples of Motil’s Fraud and Misuse of Investor Funds

A. Investor A

41. Investor A, a resident of Massachusetts, learned about investing with Motil in 

approximately August 2018. After making contact with Motil, Investor A scheduled a phone call 

to discuss Motil’s investment opportunities. During their ensuing discussion, Motil said, among 

other things, that Investor A would be “like a bank” and that her investment would be secured by 

a mortgage on a multi-family residential property in Ohio. During the discussion, and in later emails, Investor A made clear that she would be investing her retirement funds, which was or should 

have been obvious to Motil because Investor A was transferring her funds from her 401k account

into a self-directed IRA account. 

1. Investor A’s Initial Investment: Rocky River Property 

42. Motil offered Investor A an 18-month Note with a 12% APR that would pay 

monthly interest of $4,380 and a balloon payment of $438,000, consisting of the entire invested 

amount of $429,240 plus a 2% bonus at the end of the 18-month term. This Note listed the Rocky 

River Property described in ¶ 33, supra, as collateral. Relying on Motil’s representations, Investor 

A agreed in October 2018 to invest with a Motil LLC in a Note with a face amount of $438,000 

(the “Rocky River Note”). Motil also gave Investor A a document titled “Mortgage” that prohibited 

Motil from encumbering the Rocky River Property. 

43. On or about November 19, 2018, Investor A authorized the transfer of $429,240 

from her self-directed IRA into an NS Sales Chase Account to fund her investment in the Rocky 

River Note. Immediately thereafter, Motil misused Investor A’s funds by making Ponzi payments 

totaling at least $85,000 to twenty investors ($16,000 to individual investors and $69,000 to 

institutional investors). He also used over $47,000 to pay personal credit cards and over $20,000 

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to pay personal expenses such as $3,100 for student loans, $2,500 to “Leeny’s Lean Body” and 

$1,330 to iTunes.

44. Motil’s statements to Investor A concerning the Rocky River Note were materially 

false and misleading. Motil never told Investor A that her investment would be used to pay 

personal expenses and to make Ponzi payments owed to other unsuspecting investors. A 

reasonable investor would have wanted to know that Motil did not intend to use her investment for 

business purposes. 

45. Motil also failed to tell Investor A that he needed additional financing to acquire 

the Rocky River Property, which would deprive her of the “first position” lien he had promised.

Motil ultimately borrowed, and personally guaranteed the prompt payment of, $845,000 from an 

institutional lender that held a first position lien on the Rocky River Property. In December 2018, 

Motil purchased the Rocky River Property in the name of a Motil LLC, using $765,000 from the 

institutional loan and $228,000 from Investor A’s funds (roughly half of what Investor A 

provided). By issuing the mortgage to the institutional lender, Motil disregarded the provision in 

Investor A’s Rocky River Mortgage which prohibited him from encumbering the Rocky River 

Property. The institutional lender could not determine that Motil had previously issued a mortgage 

to Investor A because Motil omitted it from the loan documents provided to the lender and because 

Motil failed to record Investor A’s Rocky River Mortgage.

46. Even after Motil borrowed $845,000 from the institutional lender, he disregarded 

the terms of that mortgage by issuing eight additional Notes and mortgages to eight separate 

investors totaling at least $1,386,000, all purportedly collateralized by the Rocky River Property.

Motil never informed Investor A about the other investors who were holding notes secured by the 

Rocky River Property. These omissions were material because a reasonable investor would have 

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wanted to know that the property supposedly securing her investment was grossly overleveraged 

and that another investor had priority over her.

47. Motil’s Ponzi scheme lacked a sufficient, legitimate source of cash to fund his 

operations, such as rent, property resale, or cash-out refinances—material facts that Motil omitted 

to tell Investor A or other prospective investors. Because he lacked a sufficient, legitimate source 

of cash, Motil took funds from other unsuspecting investors to make monthly Ponzi payments to 

Investor A, but he never paid the $438,000 principal due on the Rocky River Note.

2. Investor A’s Modification & Second Investment: The Olivesburg Property

48. By September 2019, Investor A had accumulated approximately $49,500 in her

self-directed IRA. This amount included $40,880 of interest payments received in connection with 

Investor A’s Rocky River Note and additional IRA contributions. Motil contacted Investor A and 

explained that the $49,500 cash balance in her IRA was not earning interest. He suggested that 

Investor A instead invest those funds in another Note. Motil offered Investor A a $48,000 Note

“secured” by a property located at 6220 Olivesburg Fitchville Road in Greenwich, Ohio (the 

“Olivesburg Property”).

49. On or about September 30, 2019, Investor A agreed to invest the $48,000, and Motil 

sent her a Note signed by Motil on behalf of a Motil LLC (“Investor A’s Olivesburg Note”).

Investor A’s Olivesburg Note had a stated effective interest rate of 11%, and instead of providing

periodic interest payments, had a scheduled one-time balloon repayment of $66,278 due in October 

2022. On or about September 30, 2019, Investor A followed Motil’s instructions to authorize her 

IRA Custodian to make the $48,000 transfer to the NS Sales Chase Account. Motil provided 

Investor A with an Olivesburg Note and an accompanying document titled “Mortgage.”

50. Although Investor A’s Olivesburg Note was supposed to be secured by a mortgage 

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on the Olivesburg Property, Motil never recorded Investor A’s mortgage, leaving Investor A’s 

Olivesburg Note unsecured. Furthermore, when Motil solicited Investor A to invest in Investor 

A’s Olivesburg Note, he had already issued one “mortgage” on the Olivesburg Property to Investor 

B (see infra ¶¶ 62-63) and a second “mortgage” on the same property for $200,000 to another 

investor.

51. Because Motil never recorded the prior “mortgages,” there was no way that Investor 

A could have discovered the prior encumbrance on the Olivesburg Property. Motil intentionally or 

recklessly failed to inform Investor A about the other investors who were already holding notes 

secured by the Olivesburg Property. This omission was material because a reasonable investor 

would have wanted to know that the supposed “security” for their investment already served as 

the “security” for two other larger loans. Motil never paid the $66,278 due on Investor A’s 

Olivesburg Note.

3. Investor A’s Third Investment: Hearthstone Road

52. In or about mid-January 2021, Motil offered Investor A yet another investment

opportunity: a $100,000 Note, secured by a property located at 3318 Hearthstone Road in Parma,

Ohio. On or about January 27, 2021, Investor A agreed, investing $100,000 in a Hearthstone Note

that was scheduled to pay $1,250 monthly interest (15% APR) for 6 months and a final balloon 

repayment of $100,000 at the end of the 6-month term (“Investor A’s Hearthstone Note”). On or 

about January 27, 2021, Investor A followed Motil’s instructions and transferred $100,000 from 

her savings account to the NS Sales Chase Account. Motil provided Investor A with her 

Hearthstone Note, which he signed on behalf of a Motil LLC. Motil also sent Investor A a 

document titled “Mortgage.”

53. When Motil offered Investor A’s Hearthstone Note, he failed to disclose that he 

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had been experiencing severe cash flow difficulties—specifically, that he had experienced a deficit 

between rents collected and expenses for taxes, property repairs and money owed to investors and 

banks. Indeed, Motil admitted as much two months later, in a March 22, 2021 e-mail to investors

(see infra ¶ 74). In the March 22, 2021 e-mail, Motil also explained: “sometime around the end of 

2020, [he] realized if things didn’t improve, it wasn’t sustainable and we would need to make a 

drastic move that we really didn’t want to do - liquidate.” Motil intentionally or recklessly failed 

to disclose this to Investor A before her January 27, 2021 investment. This omission was material 

because a reasonable investor would have wanted to know that Motil was contemplating 

liquidating his assets while, at the same time, seeking investments.

54. By January 2021, when Motil offered Investor A her Hearthstone Note, Motil owed

at least fourteen other investors payment on approximately $1 million in investments that were

purportedly secured by the Hearthstone Property. Motil failed to record the fourteen investors’ 

mortgages, or Investor A’s mortgage.1 Motil intentionally or recklessly failed to inform Investor 

A about the other investors who were already holding notes secured by the Hearthstone Property.

This omission was material because a reasonable investor would have wanted to know that the 

Hearthstone Property was massively overleveraged and provided little, if any security.

55. As with Investor A’s previous investments, Motil failed to record Investor A’s 

Hearthstone mortgage, leaving Investor A’s Hearthstone Note unsecured. Motil also did not pay 

any of the monthly interest on Investor A’s Hearthstone Note. When her monthly interest went 

unpaid, Investor A frantically tried to reach Motil, who failed to respond to her e-mails and phone 

calls. Motil failed to pay Investor A the $100,000 balloon payment that became due in July 2021.

1 One of the Hearthstone Property investors recorded his own mortgage shortly before Investor A 

received her Note and Mortgage. A second investor recorded a “deed affidavit”, to which his 

Hearthstone Property Mortgage was attached.

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56. The value of the Hearthstone Property was far less than the $1.1 million Motil

owed. Motil bought the Hearthstone Property in November 2017, for only $47,000. By January 

2021, (when Motil offered Investor A’s Hearthstone Note), valuation services Quantarium, 

Corelogic, and Collateral Analytics valued the Hearthstone Property at $117,752, $123,600, and 

$130,000, respectively. Thus, investors were collectively under-collateralized by at least $970,000. 

57. Motil defrauded Investor A of at least $577,240: her $429,240 investment in the 

Rocky River Property, $48,000 investment in the Olivesburg Property and $100,000 investment 

in the Hearthstone Property. This was virtually all of Investor A’s life savings and retirement funds.

B. Investor B

58. Investor B, a Texas resident, is a Lieutenant Colonel in the U.S. Air Force who 

learned about Motil’s investments from another investor on a social media website called 

“Biggerpockets.com.” Investor B contacted Motil and scheduled a phone call with him in January 

2019. During the phone call (which Investor B recorded), Investor B told Motil that he was 

interested in investing his and his wife’s IRA retirement money. Motil acknowledged his 

responsibility to investors who trusted him with their retirement funds and life savings and 

explained that his investments were relatively low risk. Motil told Investor B that he never 

defaulted on a Note and was very proud of his reputation among investors. 

59. During the January 2019 telephone call, Motil also explained that he typically 

bought single-family houses for between $25,000 and $50,000, and that he rehabbed and did the 

necessary construction on the property. Motil explained that, after the renovations, the properties 

would be worth between $80,000 and $200,000 and he would then find tenants, resell the houses, 

or restructure the debt long term. 

60. During the January 2019 telephone call, Motil also told Investor B that he would 

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be an investor in a Note. Motil repeatedly assured him that the Notes would be collateralized by a 

first position mortgage on a property and further protected by an insurance policy that protected 

Investor B in case Motil suffered a catastrophic loss. Motil told Investor B that the mortgages

collateralizing the Notes would be filed so that if a title company performed a search, it would see 

Investor B’s lien on the property. Motil also told Investor B that the range of annual rate of returns

on his Notes ranged from 10% to 15%, but that he liked 12% to make computations “easier for his 

team.”

61. Relying on Motil’s representations, Investor B made a series of 4 investments in 

Notes totaling $175,300 from April 2019 to November 2019 as set forth below.

Property

Collateralizing 

Note

Principal

Amount

APR 

%

Scheduled 

Monthly

Payment 

Term Balloon 

Repayment 

Amount 

6220 Olivesburg 

Fitchville Road, 

Greenwich, 

Ohio

$61,000 12% $613 April, 2019-

May, 2020

$61,000

3318 

Hearthstone 

Road, Parma, 

Ohio

$64,300 12% $643 October 1, 

2019-

November 1, 

2020

$64,300

13410 Wainfleet 

Ave.,

Cleveland, Ohio

$25,000 12% $250 November 8, 

2019-December 

1, 2020

$25,000

11722 

Longmead Ave.,

Cleveland, Ohio

$25,000 12% $250 December 8, 

2019-December 

1, 2020

$25,000

1. Investor B’s First Investment: The Olivesburg Property

62. In or about April 2019, Investor B agreed to enter into a Note with Motil for $61,000 

that was to be collateralized by the Olivesburg Property—the same property that Motil would use 

five months later in September 2019 to supposedly collateralize Investor A’s Olivesburg Note 

(supra ¶ 48). Motil sent Investor B his version of the Note (“Investor B’s Olivesburg Note”) and

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sent Investor B a document titled “Mortgage.” Motil signed both the Mortgage and the Investor 

B’s Olivesburg Note on behalf of a Motil LLC. Motil intentionally or recklessly failed to inform 

Investor B that, at the time, another investor already held a note and “mortgage” of $200,000 on 

the same property (supra ¶ 50). On or about April 11, 2019, Investor B followed Motil’s deposit 

instructions and initiated a request that a $61,000 check be drawn from his IRA account and sent 

to an NS Management Chase Account.

63. On June 17, 2020, Motil paid the outstanding principal and interest on Investor B’s 

Olivesburg Note. Bank records show that Motil received money at 4:16 pm on June 17, 2020 from 

another investor, then paid $65,104.67 to Investor B at 5:13 pm that same day. Motil intentionally 

or recklessly failed to disclose that this was a Ponzi Payment, not derived from any legitimate 

source, such as rents from or the sale or refinance of the Olivesburg Property (or any other real 

estate operations). The omission was material because reasonable investors would have wanted to 

know that Motil’s business was not creating sufficient profits to pay back his investments and that 

Motil was instead relying on new investments – in short, that Motil was operating a Ponzi scheme.

2. Investor B’s Second Investment: Hearthstone Road

64. In or about October 2019, Motil solicited Investor B to enter into another Note that 

would be supposedly collateralized by a first lien on the Hearthstone Property. Motil would later 

use this same property to collateralize Investor A’s Hearthstone Note in January 2021 (supra ¶¶

52-56). Motil intentionally or recklessly failed to disclose that he had already issued at least five

outstanding Notes totaling $295,000 to different investors, all purportedly collateralized by this 

one property. Investor B’s Hearthstone Note had a $64,300 principal amount, was scheduled to 

pay 12% APR monthly from November 1, 2019 to November 1, 2020, and had a final $64,300 

balloon principal repayment also due on November 1, 2020. (“Investor B’s Hearthstone Note”).

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After Investor B transferred $64,300 to the NS Sales Chase Account, Motil sent Investor B’s

Hearthstone Note, via a Motil LLC. Motil also sent Investor B a document titled “Mortgage.”

Motil made sporadic interest payments on Investor B’s Hearthstone Note totaling just over 

$10,000, but never paid the $64,300 balloon payment that became due on November 1, 2020.

3. Investor B’s Wainfleet Ave. and Longmead Ave. Investments

65. On or about November 8, 2019, Motil offered Investor B two additional Notes, each 

for principal amounts of $25,000 and monthly interest payments yielding 12% from December 1,

2019 to December 1, 2020, with a balloon repayment of principal at the end of the 12-month term.

Motil represented to Investor B that the Notes would be secured by residential properties located 

in Cleveland. By their respective terms, one $25,000 Note was collateralized by a property located 

at 11722 Longmead Ave., in Cleveland, Ohio, (the “Longmead Property”). Motil signed the Note 

on behalf of a Motil LLC (the “Longmead Note”). The other $25,000 Note stated that it was 

collateralized by the Wainfleet Property described in ¶ 31, supra. Motil signed the Note on behalf 

of a Motil LLC (the “Wainfleet Note”). On or about November 12, 2019, Investor B followed 

Motil’s instructions and transferred a total of $50,000 to the NS Sales Chase Account.

66. Motil intentionally or recklessly failed to disclose to Investor B that he had already 

issued several Notes purportedly collateralized by the Longmead and Wainfleet Properties. When 

Motil issued the Longmead Note to Investor B, he already issued at least one Note to another 

investor that was collateralized by the Longmead property, with a balance of $60,000. When Motil 

sold the Wainfleet Note to Investor B, there already were four outstanding Notes collateralized by 

that property, totaling $172,000. After Investor B made his Wainfleet Property investment, Motil 

issued at least nine more Notes purportedly collateralized by the Wainfleet Property, totaling 

$276,000. Motil also intentionally or recklessly failed to disclose these subsequent investments to 

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Investor B. Only one of those subsequent investors was repaid his principal ($40,000), resulting in 

$433,000 worth of outstanding Notes that were purportedly collateralized by the Wainfleet 

Property. Motil’s omissions relating to the Longmead and Wainfleet Properties were material 

because reasonable investors would have wanted to know that the properties that “secured” their 

investments were massively overleveraged and, therefore, largely useless as collateral. 

67. From December 1, 2019 to February 10, 2021, Motil made Ponzi Payments to 

Investor B on the Wainfleet Note and the Longmead Note, but failed to make any principal 

payments thereafter. By the end of February 2021, all three of Investor B’s balloon payments were 

at least two months past due. Investor B told Motil that he needed to receive his overdue payments 

because he was being deployed to Afghanistan and would not be able to communicate from there. 

Motil then stopped responding to Investor B’s attempts to reach him. At one point, Investor B 

became so frustrated, he posted comments on Motil’s Facebook page describing his negative 

experience. Motil responded by blocking Investor B from posting anything more, and e-mailed

Investor B that negative comments were not helpful in his effort to find a “replacement” for 

Investor B. In other words, Motil told Investor B that his negative posts were unhelpful in his 

efforts to lure another victim to invest. 

C. Investor C

68. Investor C, a Florida resident, is a professor primarily involved in cancer research 

at a medical college. In approximately late June 2018, Investor C became aware of Motil by 

watching podcasts in which Motil discussed real estate investment strategies that helped “out of 

town” investors make money. Investor C signed up for Motil’s newsletters and investment 

opportunities and received Motil’s lists of “Private Lending Opportunities” approximately once a 

month. In or about late October 2020, Investor C selected a six-month Note with a face amount of

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$80,000 that paid 15% annual interest, with an $80,000 balloon payment at maturity from among 

Motil’s “opportunities.” Motil listed the value of the property at $120,000.

69. On or about October 30, 2020, after talking with Motil, Investor C wired $80,000 

from his bank account located in Florida into the NS Sales Chase Account. Motil sent Investor C 

a Note for $80,000 that stated that it was collateralized by the Hearthstone Property (“Investor C’s 

Hearthstone Note”). Motil also sent Investor C a document titled “Mortgage.” Motil signed the 

Mortgage and Investor C’s Hearthstone Note on behalf of a Motil LLC. Motil intentionally or 

recklessly failed to disclose to Investor C that he had already issued numerous Notes purportedly 

secured by the Hearthstone Property. (See supra, ¶¶ 52-56, 64.) Motil also intentionally or 

recklessly failed to inform Investor C that he continued to issue Notes secured by the Hearthstone 

Property. (Id.) These omissions were material because reasonable investors would have wanted to 

know that the properties supposedly securing their investments were grossly overleveraged.

70. Motil used Investor C’s $80,000 to make Ponzi Payments to other investors.

Afterwards, Motil made a total of three payments of $1,000 to Investor C on November 30, 2020, 

January 26, 2021 and February 1, 2021. Each of these payments were themselves Ponzi Payments 

made using investments by new investors. In fact, Motil used a portion of Investor A’s investment 

(also collateralized by the Hearthstone Property) to make the $1,000 February 1 interest payment 

to Investor C. Motil intentionally or recklessly failed to disclose the source of these payments to 

Investor C. The omission was material because reasonable investors would have wanted to know 

that Motil’s business was not creating sufficient profits to pay back their investments and that 

Motil was operating a Ponzi scheme, using new investments to pay back earlier investors.

71. After February 2021, Motil stopped making any further interest payments, and 

failed to make the $80,000 balloon payment due on May 1, 2021. As he had with other investors, 

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Motil simply stopped responding to Investor C’s e-mails and phone calls. 

72. Motil’s misrepresentations to Investors A, B, and C, and his misuse of their investor 

funds are representative of his interactions and fraudulent acts towards other victims in Motil’s 

Ponzi scheme.

VII. Motil’s Further Misstatements and Omissions to Investors 

73. As Motil’s Ponzi scheme crumbled, he tried to mollify a growing number of 

panicked investors by sending mass e-mails that failed to disclose the true nature of his scheme 

and the problems he was facing. In one e-mail dated January 13, 2021, Motil explained that he had 

experienced challenging cash flow issues in August 2020 resulting from banking and tenant 

payment matters. He assured investors that he had everything back on track and that things were 

going smoothly. In the same e-mail, Motil claimed that he had to track down his largest property 

manager for payment. He assured investors that he was working on building up a larger cash 

reserve and apologized for the poor communication. 

74. In a second e-mail dated March 22, 2021, Motil explained, among other things, that 

he had experienced consistent cash flow difficulties over the previous few months. Motil wrote

that he experienced a deficit between rent collections on the one hand, and money due to investors, 

banks, property repairs, and taxes on the other. Motil told investors that he recorded a podcast 

predicting future events in the shifting landscape of landlording. However, Motil explained that he 

did not want to release his podcast and “let the world know” what was going on in the market

before he “moved on our stuff.” Motil stated that he was not pressing the panic button, and falsely 

assured investors that he had enough equity in the properties to repay all investors. 

75. In both the January 13 e-mail and the March 22 e-mail, Motil intentionally or 

recklessly failed to include any information that he used investor money to pay personal expenses 

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and make Ponzi Payments. Similarly, the e-mails omitted any explanation about how Motil 

diverted investor money to other businesses unrelated to real estate. Moreover, Motil’s March 22, 

2021 e-mail was affirmatively false and misleading because contrary to Motil’s assertions, the 

properties lacked sufficient equity to pay investors. These false and misleading statements and 

omissions were material because reasonable investors would have wanted to know that Motil had 

misused investor funds, that Motil was only able to pay back investors by using new investor funds, 

and that Motil lacked the equity to pay back investors. 

76. Even after sending the January 13 and March 22 e-mails, Motil continued to solicit 

investors to purchase Notes purportedly secured by the same properties. 

VIII. Amy Motil Receives Ill-Gotten Gains from Motil’s Fraudulent Scheme

77. Throughout the relevant period, Motil transferred (directly or indirectly) more than

$400,000 from the Chase Accounts to his wife Amy Motil or for her benefit. Amy Motil has no 

legitimate claim to the ill-gotten funds and has been unjustly enriched by her receipt of these 

investor funds. Amy Motil should therefore be required to disgorge all of the amounts she directly 

or indirectly received from Motil, as well as to pay prejudgment interest on such amounts. 

FIRST CLAIM FOR RELIEF

Violations of Sections 5(a) and 5(c) of the Securities Act

(All Defendants)

78. The Commission re-alleges and incorporates by reference each and every allegation 

contained in Paragraphs 1 through 77 of this Complaint as if fully set forth herein. 

79. By engaging in the acts and conduct alleged in this Complaint, during the Relevant 

Period, Defendants, directly or indirectly, singly or in concert, made use of the means or 

instruments of transportation or communication in interstate commerce or of the mails to offer to 

sell securities through the use or medium of a prospectus or otherwise, or carried or caused to be 

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carried through the mails or in interstate commerce, by means or instruments of transportation, 

securities for the purpose of sale or for delivery after sale, when no registration statement had been 

filed or was in effect as to such securities, and when no exemption from registration was applicable.

The Notes that defendants offered and sold as alleged herein constitute “securities” as defined in 

the Securities Act, and as to those with terms of nine months or greater, were required to be 

registered with the Commission. 

80. By reason of the foregoing, Defendants have violated, and, unless restrained and 

enjoined, will continue to violate Sections 5(a) and 5(c) of the Securities Act [15 U.S.C. §§ 77e(a) 

and (c)].

SECOND CLAIM FOR RELIEF

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

(All Defendants)

81. The Commission re-alleges and incorporates by reference each and every allegation 

contained in Paragraphs 1 through 77 of this Complaint as if fully set forth herein. 

82. By engaging in the acts and conduct alleged in this Complaint, during the Relevant 

Period, Defendants directly or indirectly, singly or in concert, by the use of the means and 

instrumentalities of interstate commerce or of the mails, in connection with the purchase or sale of 

securities, with scienter have: (a) employed devices, schemes, or artifices to defraud, (b) made 

untrue statements of material fact and omitted to state a material fact necessary in order to make 

the statements made, in light of the circumstances under which they were made, not misleading, 

and (c) engaged in acts, practices, and courses of business which operated or would operate as a 

fraud or deceit upon other persons. 

83. By reason of the foregoing, Defendants have violated, and, unless enjoined, will 

continue to violate, Section 10(b) of the Exchange Act [15 U.S.C. § 78j(b)] and Rule 10b-5 [17 

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C.F.R. § 240.10b-5], promulgated thereunder. 

THIRD CLAIM FOR RELIEF

Violations of Section 17(a) of the Securities Act

(All Defendants)

84. The Commission re-alleges and incorporates by reference each and every allegation 

contained in Paragraphs 1 through 77 of this Complaint as if fully set forth herein. 

85. By engaging in the acts and conduct alleged in this Complaint, during the Relevant 

Period, Defendants, directly or indirectly, singly or in concert, by use of the means or instruments 

of transportation or communication in interstate commerce, or of the mails, in the offer or sale of 

securities, with scienter have: (a) employed devices, schemes, and artifices to defraud; (b) obtained 

money or property by means of untrue statements of a material fact or omissions to state a material 

fact necessary in order to make statements made, in light of the circumstances under which they 

were made, not misleading; and (c) engaged in transactions, practices, and courses of business 

which operated or would have operated as a fraud or deceit upon purchasers. 

86. By reason of the foregoing, Defendants have violated, and, unless enjoined, will 

continue to violate, Section 17(a) of the Securities Act [15 U.S.C. § 77q(a)]. 

FOURTH CLAIM FOR RELIEF

Unjust Enrichment Liability

(Relief Defendant Amy Motil) 

87. The Commission re-alleges and incorporates by reference each and every allegation 

contained in Paragraphs 1 through 77 of this Complaint as if fully set forth herein. 

88. Relief Defendant has obtained funds as part, and in furtherance of, the securities 

violations alleged above, and under circumstances in which it is not just, equitable, or conscionable 

for her to retain the funds. As a consequence, Relief Defendant has been unjustly enriched.

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PRAYER FOR RELIEF

WHEREFORE, the Commission respectfully requests that this Court enter judgment: 

I.

Permanently restraining and enjoining Defendants, their agents, servants, employees and 

attorneys, and all persons in active concert or participation with them, who receive actual notice 

of the injunction by personal service or otherwise, and each of them, from committing future 

violations of each of the securities laws and rules promulgated thereunder as alleged herein and 

from participating directly or indirectly in the issuance of purchase, offer or sale of any security 

(provided that such order would not prevent the buying and selling securities listed on a national 

securities exchange for their respective personal account). 

II.

Permanently barring Motil from acting as an officer or director of any issuer that has a 

class of securities registered pursuant to Section 12 of the Exchange Act [15 U.S.C. § 78l] and 

that is required to file reports under Section 15(d) of the Exchange Act [15 U.S.C. § 78o(d)] 

pursuant to Section 20(e) of the Securities Act [15 U.S.C. § 78t(e)] and Section 21(d)(2) of the 

Exchange Act [15 U.S.C. § 78u(d)(2)]. 

III.

Directing Defendants to disgorge all ill-gotten gains, with prejudgment interest, on a joint 

and several basis, with prejudgment interest thereon.

IV.

Ordering Relief Defendant to disgorge all funds obtained as part, and in furtherance of, 

the securities violations alleged above, with prejudgment interest thereon.

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V.

Ordering each of the Defendants to pay civil money penalties 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)]. 

VI. 

Creating a Fair Fund pursuant to Section 308(a) of the Sarbanes-Oxley Act.

VII. 

Granting such other and further relief as the Court may deem just and appropriate for the 

protection of investors pursuant to Section 21(d)(5) of the Exchange Act [15 U.S.C. §78u(d)(5)]. 

JURY DEMAND

Pursuant to Rule 38 of the Federal Rules of Civil Procedure, the SEC hereby demands trial

by jury. 

Dated: September 25, 2023 Respectfully submitted,

 /s/ John B. Timmer 

 

John B. Timmer (D.C. Bar No. 997309) 

TimmerJ@sec.gov

COUNSEL FOR PLAINTIFF

Securities and Exchange Commission 

 100 F Street, N.E. 

Washington, DC 20549 

 T: (202) 551-7687 

 

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