San Diego financial firm’s CEO pleads guilty to fraud, ID Theft
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| Carlos Manuel da Silva Santos, founder and CEO of San Diego-based Ethos Asset Management, Inc., |
Portuguese CEO Pleads Guilty in $17M Financial Fraud SchemeCarlos Manuel da Silva Santos, founder and CEO of San Diego-based Ethos Asset Management, Inc., pleaded guilty to wire fraud conspiracy and aggravated identity theft in federal court, admitting to orchestrating an elaborate international loan scam that caused at least $17.1 million in losses to U.S. victims.
The 30-year-old Portuguese national ran Ethos as a self-described "full-service project financing" company, requiring prospective borrowers to provide substantial upfront fees as collateral for promised loans. However, prosecutors revealed that in many cases, the loans never materialized, and Santos used new clients' collateral fees to pay off previous borrowers in a classic Ponzi-style scheme.
To lure investors, Santos and his co-conspirators fabricated financial documents, including forging an auditor's signature to falsely claim the company held over $2.2 billion in assets. In one instance, Santos convinced a victim to wire an $8 million upfront fee by claiming Ethos had $359 million in a brokerage account that didn't exist.
The scheme extended beyond U.S. borders, with operations in Brazil, Turkey, and other countries. Prosecutors indicated they will present evidence at a restitution hearing showing Santos owes "significantly more money" to additional victims worldwide.
Santos has remained in custody since his arrest at Newark International Airport in November 2023. Sentencing is scheduled for April 18, 2025, before U.S. District Judge Robert S. Huie. He faces up to 30 years in prison for wire fraud conspiracy, plus a mandatory consecutive two-year term for aggravated identity theft.
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SIDEBAR: Who is Carlos Santos?
**Age:** 30
**Nationality:** Portuguese
**Position:** Founder and CEO, Ethos Asset Management, Inc.
Carlos Manuel da Silva Santos emerged as a young financial executive, establishing Ethos Asset Management in San Diego as what appeared to be a legitimate international lending organization. Despite his youth, Santos managed to create an impression of financial sophistication that convinced businesses and financial institutions worldwide of his company's legitimacy.
The facade began to crumble when investigators discovered Santos had systematically falsified financial statements, including forging auditor signatures and inflating account balances by hundreds of millions of dollars. In one notable instance, he presented a bank statement showing over $100 million in assets when the actual balance was significantly lower.
Santos' scheme combined elements of traditional fraud with modern financial complexity, using the promise of business loans to collect upfront "collateral" fees from victims across multiple countries. The investigation revealed that rather than operating a legitimate lending business, Santos used new clients' fees to pay off previous borrowers while funding personal expenses and commissions to co-conspirators.
Victims or those who believe they may have been affected by the Ethos Asset Management scheme are encouraged to contact Homeland Security Investigations at ethos-victim@hsi.dhs.gov.
CEO of Financial Firm Pleads Guilty to Running a Multimillion Dollar Fraud
SAN DIEGO – Carlos Manuel da Silva Santos, the founder and chief executive officer of San Diego-based Ethos Asset Management, Inc., which offered financing to domestic and international businesses, pleaded guilty to wire fraud conspiracy and aggravated identity theft today in federal court.
Santos, a Portuguese national, has been in custody since his arrest on November 13, 2023, in Newark, New Jersey, after arriving in the United States from abroad.
According to his plea agreement, Santos admitted he and co-conspirators held Ethos out to the public as a “full-service project financing” company that offered loans to prospective borrowers in exchange for an upfront fee as collateral for Ethos to use. However, on many occasions when a borrower gave Ethos the upfront fee as collateral, Ethos’ funding never materialized.
To induce prospective borrowers to send Ethos an upfront fee as collateral and enter into loan agreements, Santos and his co-conspirators lied about Ethos’ history of funding projects, the source of Ethos’ money, the amount of capital available to disburse loans, and how Ethos used the collateral upfront fees. For instance, Santos admitted that he used money from the upfront collateral fees to release collateral deposited by other borrowers and to disburse loans to other borrowers.
Santos also admitted that he and others altered otherwise legitimate financial account statements to inflate the amount of money Ethos appeared to have at its disposal to finance projects for the purpose of luring prospective borrowers to provide collateral and financial institutions to lend money. For example, in August 2021, Santos successfully induced a borrower to wire money as a collateral upfront fee by sending a bank statement that falsely represented Ethos having $100,304,447.46 when, in fact, it did not.
In February and May 2023, Santos again induced borrowers to provide collateral upfront fees by emailing a copy of Ethos’ annual financial statements reflecting falsely that Ethos had over $2.2 billion in total assets and that an accounting firm had audited the statements. Indeed, Santos admitted that he knowingly forged the signature of an employee at a bookkeeping firm on Ethos’s 2022 annual financial statement to falsely indicate that the firm had audited the statement. In each noted example, Ethos fraudulently obtained upfront fees and failed to disburse loan payments as promised.
Santos further admitted Ethos’ project financing scheme was international in nature, with a presence in the United States, Brazil, Turkey, and elsewhere. Santos admitted his scheme resulted in $17,125,000 in losses to certain U.S. based victims. The plea agreement also explains that the parties will request a restitution hearing allowing the United States to offer evidence that Santos owes significantly more money to various other victims.
According to the plea agreement, Santos also forged the signature of an employee at an accounting firm to make it appear that the firm had audited Ethos’ annual financial reports.
“Untold numbers of people fall victim to fraud schemes every year,” said U.S. Attorney Tara McGrath. “Whether it’s a simple email scam or an elaborate investment scheme, the U.S. Attorney’s Office will relentlessly pursue accountability for the defendants and restitution for the victims.”
“Today’s guilty plea underscores Homeland Security Investigation’s (HSI) unwavering commitment to combating financial crimes,” said Shawn Gibson, Special Agent in Charge for HSI San Diego. “This successful outcome is the result of an extensive, long-term investigation where our dedicated agents and partners assigned to the Costa Pacifico Financial Task Force worked tirelessly and diligently to gather all the evidence and bring this individual to justice. Their unwavering commitment and thorough efforts have been instrumental in protecting our community and upholding the law.
Sentencing is scheduled for April 18, 2025, before U.S. District Judge Robert S. Huie.
This case is being prosecuted by Assistant U.S. Attorneys E. Christopher Beeler, Carl F. Brooker IV, and Amy B. Wang.
If you believe you are a victim of Carlos Santos and his company Ethos Asset Management, Inc., contact Homeland Security Investigations at ethos-victim@hsi.dhs.gov.
DEFENDANT
Carlos Manuel da Silva Santos Age: 30 Portugal
SUMMARY OF CHARGES
Wire Fraud Conspiracy – Title 18, U.S.C., Section 1349
Maximum penalty: Thirty years in prison and $250,000 fine
Aggravated Identity Theft – Title 18, U.S.C. Section 1028A
Maximum penalty: Mandatory two years in prison consecutive to the term for the underlying felony
INVESTIGATING AGENCY
Homeland Security Investigations
San Diego financial firm’s CEO pleads guilty to fraud, ID Theft – NBC 7 San Diego
Carlos Manuel da Silva Santos headed Ethos Asset Management, Inc., which the U.S. Attorney's Office said caused more than $17 million in losses to victims in the United States.
The founder and CEO of a San Diego-based financial firm pleaded guilty Thursday to charges of wire fraud conspiracy and aggravated identity theft.
Carlos Manuel da Silva Santos, 30, headed Ethos Asset Management, Inc., which the U.S. Attorney's Office said caused more than $17 million in losses to victims in the United States.
Prosecutors say Ethos offered loans to prospective borrowers who paid upfront fees as collateral, but loan funds often were never provided. Other times, the loans were made up of collateral fees paid by other borrowers, prosecutors said.
Santos and others at Ethos also made numerous misrepresentations about the company's ability to provide loans and to that end, altered financial statements to falsely represent Ethos' assets, according to the U.S. Attorney's Office.
For example, the U.S. Attorney's Office said Santos forged the signature of a bookkeeping firm employee to falsely represent that the firm had audited a financial statement claiming Ethos has over $2.2 billion in total assets. Another time, Santos sent a borrower a bank statement that falsely stated Ethos had more than $100 million.
Though Santos' plea agreement outlines $17,125,000 in losses to U.S. victims, prosecutors say they will seek to offer evidence at a restitution hearing "that Santos owes significantly more money to various other victims."
Santos was arrested in New Jersey in November of 2023 and has been in custody since then.
Copyright City News Service
CEO of San Diego Financial Firm Charged in Loan Scam
NEWS RELEASE SUMMARY – November 13, 2023
SAN DIEGO – The CEO of San Diego-based Ethos Asset Management, Inc., which offers financing to international businesses, was arrested in New Jersey Sunday night in connection with fraud charges in the Southern District of California.
Carlos Manuel da Silva Santos of Portugal was taken into custody in Newark, New Jersey as he arrived in the United States from abroad. Santos made his initial appearance there today after the United States unsealed a complaint charging him with wire fraud conspiracy related to a loan scam. Santos is accused of orchestrating the fraud through his company, San Diego-based Ethos Asset Management, Inc.
According to the complaint, Santos required prospective borrowers to provide an upfront fee in an amount equal to a certain percentage of the loan amount. However, upon receipt of the upfront fee, Santos and Ethos did not disburse the loan as agreed upon by the parties. Santos used the upfront fees to repay other prospective borrowers, issue commissions to his co-conspirators, and to pay for personal expenses.
The complaint alleges that to lure prospective borrowers and to obtain lines of credit from financial institutions in furtherance of the scheme, Santos manipulated Ethos’ balance sheets and real financial account statements to artificially inflate Ethos’ net worth. For example, the complaint alleges that Santos induced at least one victim to pay an upfront fee in excess of $8 million by representing Ethos had $359,088,190.22 in a specific brokerage account, but records established that Ethos had no such account. Similarly, the complaint contends Santos altered Ethos bank account statements to inflate bank account balances to prospective borrowers, sometimes by more than $100 million than what was deposited in the account.
This case is being prosecuted by Assistant U.S. Attorney E. Christopher Beeler and Carl F. Brooker, IV.
DEFENDANTS Case Number 23-MJ-4145
Carlos Manuel da Silva Santos Age: 29 Portugal
SUMMARY OF CHARGES
Wire Fraud Conspiracy – Title 18, U.S.C., Section 1349
Maximum penalty: Twenty years in prison and $250,000 fine
AGENCY
Homeland Security Investigations
*The charges and allegations contained in a complaint are merely accusations, and the defendant is considered innocent unless and until proven guilty.
Ethos Asset Management CEO Pleads Guilty to Multimillion-Dollar Fraud Scheme in Newark
In a straightforward admission of guilt, Carlos Manuel da Silva Santos, the head of Ethos Asset Management, Inc., faced the legal music by pleading guilty to charges of wire fraud conspiracy and aggravated identity theft, the U.S. Attorney’s Office revealed. Ethos, which purported to offer loans and financial assistance to businesses, turned out to be nothing more than a well-crafted facade for Santos' fraudulent activities, snaring unwary victims in a complex net of lies.
Caught in the act when landing in Newark, New Jersey from an international jaunt on November 13, 2023, the 30-year-old CEO from Portugal, who's since been detained, duped clients into handing over substantial fees under the guise of loan collateral—an exchange that typically left the borrowers empty-handed, as loans promised by Ethos never came to pass, Santos inflated Ethos' financials, using doctored statements to lure more borrowers into the scheme which caused, according to a statement from the U.S. Attorney's Office, a staggering $17,125,000 in losses to victims stateside.
The deception was elaborate, with Santos and his cohorts falsifying Ethos' balance sheets to over $2.2 billion in assets, a figure falsely backed by forged audit evidence - these are the facts as exposed in the plea agreement. This wasn't a hapless one-off; Santos' scheme spanned multiple countries, touching down in places as diverse as Brazil and Turkey, only to circle back to American shores, where his deceit finally saw its curtain call.
Coming to the aid of those swindled was the work of Homeland Security Investigations and the Costa Pacifico Financial Task Force, with Shawn Gibson, HSI's San Diego SAC, acknowledging in a statement the extensive, long-term investigation that ultimately yielded Santos' admission of guilt "Their unwavering commitment and thorough efforts have been instrumental in protecting our community and upholding the law," Gibson stated, affirming HSI's role in bringing financial scammers to justice and never allowing their facade of legitimacy to go unquestioned for long, as per the U.S. Attorney's Office.
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