California CEO Convicted in $2 Million Ponzi Scheme Involving Smart Rings

Michelle Bisnoff, CEO of Esos Rings Inc., has been convicted for orchestrating a Ponzi scheme that defrauded investors of nearly $2 million. The scheme involved fabricating ownership of patented near-field communication (NFC) payment rings that belonged to UK-based McLear Ltd., which had contracted Bisnoff to develop its U.S. market. Bisnoff solicited funds from investors by claiming the money would be used to increase manufacturing and inventory to meet demand from major retailers such as Target and Walmart. However, authorities stated that Esos had no agreements with these retailers and had generated minimal revenue, selling only six rings through Walmart, three of which were returned. Additionally, Bisnoff falsely claimed that Apple Inc. and Roc Nation were investors in her company. When she failed to deliver promised returns, she provided excuses described by one investor as “dog-ate-my-homework.” Bisnoff also attempted to embezzle approximately $550,000 from an employer to repay investors, but the checks bounced. In total, she caused around $1.4 million in direct losses to investors. Furthermore, Bisnoff illegally applied for a $150,000 federal COVID-19 relief loan through the Economic Injury Disaster Loan (EIDL) program, misusing part of the funds for personal expenses, including a $15,600 monthly rent on a leased house in Pacific Palisades. In 2023, the SEC sued Bisnoff and her company for defrauding investors, and a court later ordered them to pay over $836,000, which they have not repaid. A sentencing hearing is scheduled for January 21, 2027, with potential penalties including up to 20 years in federal prison for each count of securities and wire fraud, as well as additional time for money laundering and identity theft charges.