Liquid Investment Was a Solid SCAM!

Schemers linked to a water-vending “investment” raised hundreds of millions by marketing fictitious machines and rewarding early investors with money from later ones.

At a Glance

Between 2016 and 2024, investors were solicited to buy water-vending machines that often did not exist.
The founder, Ryan Wear, raised at least $165 million from retail investors and another $110 million from institutional buyers.
He allegedly maintained the façade with Ponzi-style payments and diverted millions into personal ventures.
Portfolio manager Jordan Chirico directed roughly $100 million of client funds into the scheme while hiding his own $7 million-plus stake.
Both the Department of Justice and the SEC brought parallel criminal and civil charges on August 14, 2025.

Fraud Flows, Then Fizzles

Scheme Structure and Scope

Ryan Wear, founder of Water Station Management LLC and related entities, ran an elaborate Ponzi-style operation. Between September 2016 and early 2024, he raised at least $165 million from everyday investors—many being military veterans—by selling them water-vending machine contracts that promised regular passive income. Simultaneously, the scheme pulled in another $110 million from institutional investors through bonds supposedly backed by vending machines. In both cases, the majority of these machines either never existed, were double-sold, or were misrepresented entirely.

The Ponzi Facade and Personal Profits

Rather than generating legitimate revenue, Wear allegedly paid returns to early investors using funds from new participants. He siphoned off more than $60 million to finance other business ventures and personal expenses—ensuring the illusion of success until the scheme collapsed. Water Station filed for bankruptcy in August 2024, by which point over $200 million in losses had been inflicted on investors.

Adviser Breach of Trust

Jordan Chirico, a portfolio manager at Leucadia Asset Management’s 3/5/2 Capital ABS Master Fund, directed approximately $100 million of his clients’ investments into the fraudulent bonds. Crucially, he failed to disclose that he personally held a $7 million stake in Water Station, received monthly payments exceeding $90,000, and gained referral fees. Despite facing multiple warning signs about the legitimacy of the collateral, he prioritized his own financial recovery over his clients’.

Dual Enforcement Action

On August 14, 2025, the Department of Justice unsealed criminal indictments charging Wear with securities fraud and wire fraud, and Chirico with investment-adviser and securities fraud. Each count carries a potential prison term of up to 20 years. On the same day, the Securities and Exchange Commission filed parallel civil enforcement actions, seeking injunctive relief, disgorgement, officer-and-director bans, and financial penalties.

Broader Implications

This case underscores how Ponzi models can be dressed up with tangible-seeming assets—like vending machines—to ensnare investors. It highlights crucial red flags: “guaranteed” returns, elaborate collateral that can’t be verified, undisclosed conflicts of interest, and reliance on new investor money to fund old obligations.