Torchia finally met a more formidable opponent in the U.S. Securities and Exchange Commission, which filed suit in 2015 accusing him of exploiting elderly and naïve investors by promising fat profits, bolstering his lifestyle in the process. Torchia long maintained that none of his investors ever lost money while he controlled the companies, and that the federal government just didn’t understand the viaticals business like he did.
“I have never done anything dishonest in my life,” Torchia once said in an email to a former salesman he was suing. “So the SEC can go (expletive) themselves.”
In 2016 a federal judge sided with the SEC and appointed a receiver to try to return some $10 million to dozens of Credit Nation’s investors, breaking up the network of companies.
“To the extent Mr. Torchia claims he is seeking to reform his companies’ operations to comply with SEC requirements, the Court does not believe him,” U.S. District Judge William S. Duffey Jr. wrote in his decision. “Rather his ‘fight to the death’ approach to business and court obligations ... supports that reform is not reasonable to expect.”
The criminal case against Torchia had been pending since before the pandemic, when a grand jury accused him of raising over $40 million in promissory note purchases from investors, marketing them as “100% asset-backed” even though he was operating at huge losses and knew that the SEC was looking into his operations.
Torchia, 64, did not testify at trial and did not return a call from the AJC after the verdict. His attorney, federal public defender Brian Mendelsohn, said Tuesday that the trial jury saw Credit Nation’s notes were 100% asset-backed, and, far from being naïve, his investors were sophisticated millionaires with their own financial advisors.
“The SEC and the United States Attorney’s Office made a slew of allegations that they were ultimately unable to prove,” the defense attorney said in an emailed statement.