Federal prosecutors have charged two men with defrauding over 250 investors—including military veterans—out of more than $200 million through a sophisticated Ponzi scheme disguised as a water vending machine investment opportunity.
Story Highlights
- Ryan Wear and Jordan Chirico face federal charges for orchestrating a $200+ million Ponzi scheme targeting veterans
- The fraud used non-existent water vending machines as investment vehicles with promises of guaranteed returns
- Hedge fund manager Chirico secretly funneled nearly $100 million of client funds into the scheme
- Over 250 investors, predominantly military veterans, lost their life savings to the elaborate fraud
Scheme Exploited Veterans’ Trust
Ryan Wear, founder of Water Station Management LLC, and Jordan Chirico, a hedge fund portfolio manager, allegedly ran an eight-year Ponzi scheme from September 2016 through February 2024. The duo specifically targeted military veterans with promises of exclusive financing deals and guaranteed returns on water vending machine investments. This predatory targeting of those who served our country represents a particularly despicable form of financial exploitation that undermines trust in legitimate investment opportunities.
Phantom Machines Generated Real Losses
Federal prosecutors revealed that many of the water vending machines investors believed they were purchasing simply did not exist. Wear solicited investments by promising high, stable returns from machines that would dispense clean water—appealing to investors’ environmental consciousness while stealing their money. The scheme collapsed in February 2024 when new investor funds could no longer sustain payments to earlier victims, leading to Water Station Management LLC’s bankruptcy filing in August 2024.
Hedge Fund Manager’s Hidden Conflicts
Jordan Chirico, working as a portfolio manager at 3|5|2 Capital ABS Master Fund LP, allegedly concealed his personal financial stake in Water Station Management while directing nearly $100 million of his fund’s investor money into the fraudulent scheme. This breach of fiduciary duty represents a fundamental violation of the trust placed in financial professionals. The Securities and Exchange Commission has filed civil charges against both men, emphasizing how Chirico’s position allowed him to legitimize the fraud with institutional investment.
Justice Department Takes Action
Both defendants now face serious federal criminal charges announced on August 14, 2025, alongside SEC civil enforcement actions. The case highlights the Trump administration’s commitment to prosecuting financial crimes that target vulnerable Americans, particularly our nation’s veterans who deserve protection from predatory schemes. SEC official Corey Schuster specifically noted the targeting of veterans and the massive scale of the fraud, signaling aggressive enforcement against those who exploit military families’ trust and sacrifice.
Sources:
Founder of water vending machine company, portfolio manager charged in $275M Ponzi scheme
Everett businessman accused of $200M Ponzi scheme involving water vending machines
