Daveed Diggs, Okieriete Onaodowan, Anthony Ramos, and Lin-Manuel Miranda
Daveed Diggs, Okieriete Onaodowan, Anthony Ramos, and Lin-Manuel Miranda (Joan Marcus)

Federal regulators obtained a preliminary injunction and continued asset freeze in the case against two New York-based men involved in an alleged $97 million ticket resale Ponzi scheme.

The Securities and Exchange Commission secured the preliminary injunction against Joseph Meli, Matthew Harriton and four ticket reselling businesses they run. According to a recently filed amended complaint, prosecutors allege the duo deceived investors numbering over 100 and stretching across 17 states, telling them their money would be pooled to buy tickets in bulk to be sold at a markup. Funds were allegedly solicited to buy tickets to the musical “Hamilton”; a concert festival featuring The Rolling Stones, Bob Dylan, Paul McCartney and other artists; and other performances.

The injunction, signed by Southern District Judge Louis Stanton last week, follows the freezing of assets against Meli and Harriton earlier this year. The injunction prevents all parties involved from raising any additional funds in the venture, as well as from knowingly participating in a fraudulent scheme. Stanton also extended the asset freeze order.

According to the SEC, the defendants used $59 million of the funds raised to enact the Ponzi scheme, by paying earlier investors with money raised from newer investors. Other funds raised were diverted directly to Meli and Harrison, prosecutors allege.

Beyond the injunction, the case Securities and Exchange Commission v. Meli, 1:17-cv-00632, has been stayed pending the outcome of a separate but connected criminal case, United States v. Simmons, 1:17-cr-00127, in which Meli is a party. In that case, Meli is accused of helping to defraud a hedge fund that involved, in part, the alleged ticket Ponzi scheme.