SEC Charges Washington Water Machine Founder and Portfolio Manager in $275 Million Fraud Scheme

The U.S. Securities and Exchange Commission (SEC) has filed charges against Ryan Wear, founder and owner of Washington-based Water Station Management LLC and Creative Technologies, Inc., for allegedly orchestrating two Ponzi-like fraud schemes that raised more than $275 million from over 250 investors between 2016 and 2024.

In a separate action, the SEC also charged Jordan Chirico, a portfolio manager from Indiana, for breaching his fiduciary duty by steering his private fund client into the scheme despite having personal investments in Water Station and awareness of major red flags.

Details of the Alleged Fraud

According to the SEC’s complaint, Wear and his companies raised:

• $165 million between 2016 and 2023 from retail investors, including military veterans, through contracts tied to supposed water machine purchases. Thousands of these machines either never existed or had already been sold to other investors.
• $110 million from institutional investors between 2022 and 2024 through “Water Station notes” allegedly backed by water machines that also did not exist or were not owned by the company.

The SEC alleges that over $60 million in investor funds were misappropriated to make Ponzi-like payments to earlier investors and finance Wear’s other businesses, including Refreshing USA, LLC and Ideal Property Investments LLC.

Chirico, meanwhile, is accused of concealing his personal stake in Water Station while directing his fund client to buy more of the company’s notes, even as evidence mounted that the collateral machines may have been fabricated.

SEC and Parallel Criminal Charges

Both complaints, filed in the U.S. District Court for the Southern District of New York, charge the defendants with violating antifraud provisions of federal securities laws. The SEC seeks injunctions, civil penalties, disgorgement of ill-gotten gains, and an officer-and-director bar against Wear.

In parallel, the U.S. Attorney’s Office for the Southern District of New York announced criminal charges against Wear and Chirico. The FBI, IRS Criminal Investigation, U.S. Postal Inspection Service, and other federal and state agencies assisted in the case.

Enforcement Commentary

“Wear’s alleged scheme spanned more than seven years and ensnared hundreds of investors, including veterans,” said Corey Schuster, Chief of the SEC’s Asset Management Unit. “Furthermore, it is fundamental to the advisory relationship that investment advisers act in their clients’ best interests. As alleged, Mr. Chirico failed to do so while increasing his client’s investments in Water Station despite red flags.”

The SEC emphasized that the litigation will proceed alongside criminal prosecutions, underscoring the coordinated effort among regulators and law enforcement to pursue large-scale financial frauds.

Read the official SEC release here: SEC Press Release 2025-107