Two California men have been charged with operating a Ponzi scheme that fraudulently raised about $10 million from retail investors by promising exclusive investment opportunities “previously only available to the one-percenters.”

The U.S. Securities and Exchange Commission on Tuesday said Jaswant “Jason” Gill, the founder and CEO of JSG Capital Investments, and Javier Rios personally pocketed at least $2.8 million in investor funds, using some of the money to pay for excursions to high-end restaurants and luxury retail stores as well as jaunts to Las Vegas casinos, gentlemen’s clubs, and professional sporting events.

JSG Capital advertises itself as a “boutique advisory firm” with offices in San Francisco, Los Angeles and New York. According to a civil complaint filed by the SEC, Gill and Rios told investors they could secure annual returns of up to 60% by investing in hot pre-IPO stocks such as Airbnb, Alibaba and Uber.

The two men have also been indicted on parallel criminal wire fraud charges. Less than 1% of investor funds was actually transferred to JSG trading accounts, the SEC said.

“We allege that Gill and Rios enticed middle-class investors by promising access to highly coveted investment opportunities they claimed were typically reserved for the rich,” Jina L. Choi, director of the SEC’s San Francisco Regional Office, said in a news release.

According to JSG’s website, Gill, 48, founded the firm in 2006 after a career on Wall Street that included serving as a managing director of Morgan Stanley. Prosecutors said Rios, 33, was JSG’s strategic relationship manager.

JSG allegedly targeted middle-class investors, with Gill saying in one press release that the firm would give investors “access to alternative investment strategies that were previously only available to the one-percenters” and touting “close ties” to well-known Silicon Valley venture capital firms that would provide JSG with access to pre-IPO shares.

The SEC said there is no record of Gill ever being employed at Morgan Stanley and Rios has a background in food service. They were both arrested last week by the FBI.

“JSG is a classic investment scam and Ponzi scheme,” the agency said.

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