The US Securities and Exchange Commission has charged a former broker in Orlando, Flaorida in connection with duping investors in an astrology based Ponzi scheme.

The US watchdog accused Gurudeo "Buddy" Persaud for enticing family, friends, and others into investing in his firm, White Elephant Trading Company.

The broker guaranteed them that their money would be secure and would fetch subtle returns ranging from 6 to 18%.

Persaud assured investors that the capital will be invested in the debt, stock, futures, and real estate markets, but did not disclosed that his trading strategy was based on his belief that markets are affected by gravitational forces.

The case filed in the US District Court for the Middle District of Florida, accuses Persaud that he used investors’ money to make payments to other investors, the hallmark of a Ponzi scheme.

The regulatory body also found that Persaud had lost $400,000 of investor funds through his trading and diverted at least $415,000 to pay for his personal expense and created phony account statements to hide his trading losses and give investors a false sense of security.

SEC’s Miami Regional Office Director Eric Bustillo said Persaud preyed on people who trusted him by promising high and steady returns while hiding his unconventional trading strategy.

"When Persaud blatantly lied to investors and hid their losses through a Ponzi scheme, he should have known that an SEC enforcement action was in the stars," Bustillo added.

The SEC has sought for disgorgement of ill-gotten gains, financial penalties, and injunctive relief against Persaud to enjoin him from future violations of the federal securities laws.