Rey Grabato’s Ponzi Scheme Allegedly Defrauded 2,000 Investors of $650 Million

A New Jersey real estate fund executive is wanted by federal authorities after allegedly orchestrating a Ponzi-like scheme that defrauded approximately 2,000 investors of over $650 million between February 2018 and January 2022.

Rey E. Grabato II, former president and majority owner of National Realty Investment Advisors LLC (NRIA), was added to the FBI’s newly created Most Wanted Fraudsters list in August 2026, with a reward of up to $150,000 offered for information leading to his arrest and conviction. Grabato is believed to be a fugitive in the Philippines and is only the second person placed on the registry.

Because NRIA and its principals were not registered brokers or investment advisers, Meyer Wilson Werning is unable to pursue claims directly against Grabato, Salzano, or NRIA itself. However, if investors purchased NRIA fund interests through broker-dealers or licensed financial advisors who recommended the product, an experienced Ponzi scheme attorney may be able to help.

What Do Current Disclosures Report About Rey Grabato?

Unlike a typical registered broker or investment adviser representative, Grabato’s alleged misconduct centers on his role as president and majority owner of NRIA rather than as a FINRA-registered individual.

Despite the lack of traditional brokerage disclosures, Grabato faces overlapping federal and state enforcement actions:

• SEC civil enforcement action (October 2022): The SEC charged NRIA and four former executives, including Grabato, with allegedly operating a Ponzi-like scheme that raised approximately $600 million from about 2,000 investors. The SEC press release on NRIA charges alleges that investor funds were used to pay distributions to other investors, finance personal and luxury purchases by an executive’s family, and pay reputation management firms, while NRIA allegedly generated little to no profits.
• DOJ criminal indictment (October 12, 2022): The U.S. Attorney’s Office for the District of New Jersey indicted Grabato and co-defendant Thomas Nicholas Salzano on 18 counts, including conspiracy to commit securities fraud, securities fraud, conspiracy to commit wire fraud, wire fraud, and conspiracy to defraud the United States, tied to an alleged $650 million Ponzi scheme and approximately $26 million in alleged tax evasion. The DOJ release on the NRIA indictment details the government’s allegations.
• FBI Most Wanted Fraudsters listing (August 2026): FBI Newark announced that Grabato was placed on the Most Wanted Fraudsters list because he is wanted for his alleged participation in a scheme that allegedly defrauded approximately 2,000 investors, including hundreds in New Jersey, of over $650 million.

Thomas Nicholas Salzano, identified by prosecutors as NRIA’s shadow chief executive officer who used Grabato as a public-facing stand-in, has since pleaded guilty and was sentenced to 12 years in prison for his role in the scheme and related tax-fraud conduct. Grabato remains at large.

What Do Past Regulatory Actions Indicate for NRIA Investors?

National Realty Investment Advisors LLC marketed itself as a real estate development firm and fund manager, heavily advertising investments nationwide through radio and television, and allegedly promising returns of up to 20 percent, according to SEC and state regulatory materials. The company offered interests in NRIA Partners Portfolio Fund I LLC to investors who believed their money would be used to buy and develop real estate properties.

Multiple government agencies have characterized NRIA’s operations as a Ponzi or Ponzi-like scheme:

• The New Jersey Bureau of Securities issued a Cease and Desist Order finding that NRIA allegedly fraudulently sold at least $630 million in securities to investors in New Jersey and across the nation between 2018 and 2022. The order identifies co-founders and executives including Grabato, Coley O’Brien, Thomas Nicholas Salzano, and Arthur Scutaro as connected to the alleged fraud.
• The SEC alleges that NRIA manipulated financial statements and marketing materials to disguise the alleged misuse of investor funds and create a false appearance of revenue and successful operations.
• NRIA filed for Chapter 11 bankruptcy on June 7, 2022.

The scheme allegedly impacted retirees in particular. SEC materials reference hundreds of retirees and tens of millions of retirement-account dollars among the allegedly defrauded investors. Investors who purchased NRIA fund interests through a broker-dealer or financial advisor may have additional legal options against those intermediaries, particularly if the recommending firm failed to conduct adequate research into NRIA’s operations before selling the product.

How NRIA Was Sold and Who May Bear Responsibility

The government’s central allegation is that NRIA recycled incoming investor capital to pay distributions to earlier investors rather than deploying it into legitimate real estate development. That structure is the defining feature of a Ponzi scheme, and it held together only as long as new money kept coming in. When it stopped, the bankruptcy filing followed within months.

For investors who purchased NRIA fund interests through a broker-dealer or registered representative, the relevant legal standards depend on when the recommendation was made. Before June 30, 2020, FINRA Rule 2111 required that any recommendation be suitable for the specific investor. After that date, Reg BI imposed a stricter “best interest” standard. Because NRIA’s scheme ran from 2018 through 2022, both standards may apply depending on when a particular investor received the recommendation. Separately, under FINRA Rule 3110, broker-dealer firms had a duty to supervise their representatives’ sales of NRIA fund interests, including conducting reasonable due diligence into the fund’s structure and operations.

How Meyer Wilson Werning Can Help

Salzano is already serving 12 years in federal prison and has been ordered to pay over $507 million in restitution, but bankruptcy liquidation proceedings have recovered only a fraction of that amount for investors. Grabato remains a fugitive.

For the approximately 2,000 investors who placed money into NRIA’s fund, criminal prosecution and SEC enforcement alone will not make them whole. Investors who purchased NRIA fund interests through a broker-dealer or registered representative may have additional options, including civil claims against the firms that recommended or facilitated those purchases without conducting adequate due diligence into NRIA’s operations.

For over 25 years, Meyer Wilson Werning has recovered more than $350 million for investors harmed by the firms and advisors who put them in harm’s way. Claims against NRIA and its principals directly are generally not available through our firm, but if a broker-dealer or financial advisor recommended this investment to you, contact us today for a free and confidential consultation. You pay nothing unless we recover for you.

Frequently Asked Questions

Who is Rey E. Grabato II in relation to National Realty Investment Advisors (NRIA)?

According to SEC and DOJ records, Rey E. Grabato II was the president and majority owner of National Realty Investment Advisors LLC. He is one of four former executives charged with allegedly running a Ponzi-like real estate investment scheme that raised over $650 million from approximately 2,000 investors between February 2018 and January 2022.

How much money did the NRIA Ponzi scheme allegedly take from investors?

Federal prosecutors and regulators allege that NRIA and its executives, including Rey Grabato, defrauded approximately $600 to $650 million from about 2,000 investors between February 2018 and January 2022. The New Jersey Bureau of Securities separately found that NRIA allegedly sold at least $630 million in fraudulent securities during that period.

Why did the FBI add Rey Grabato to its Most Wanted Fraudsters list?

FBI Newark placed Rey E. Grabato II on the Most Wanted Fraudsters list in August 2026 because he is wanted for his alleged participation in a scheme that allegedly defrauded approximately 2,000 investors of over $650 million. The FBI is offering a reward of up to $150,000 for information leading to his arrest and conviction, and Grabato is believed to be a fugitive in the Philippines.