Tech CEO Sentenced to Decades for $2M Smart Ring Ponzi Scheme

Michelle Bisnoff, the CEO of Esos Rings Inc., has been sentenced to decades in prison for orchestrating a nearly $2 million Ponzi scheme. Her fraudulent activities included falsely claiming ownership of patented smart ring technology and improperly obtaining a federal business-relief loan during the COVID-19 pandemic.

Bisnoff initiated the scheme in 2017 by asserting ownership of near-field communication (NFC) payment ring patents that belonged to McLear Ltd., a United Kingdom-based company that had engaged her to develop its U.S. market presence. She solicited investments by promising that funds would escalate manufacturing and build inventory to satisfy demand from major retailers like Target and Walmart. However, Esos Rings had no agreements with Target, generated minimal revenue, and had only sold six rings through Walmart, with three being returned by customers.

Bisnoff further misled investors by falsely claiming that Apple Inc. and Roc Nation were investing in her company, despite the absence of any deals with either entity. When unable to fulfill promised returns, she offered unsubstantiated excuses. She also attempted to embezzle approximately $550,000 from an employer to repay investors, but the checks bounced. In total, Bisnoff defrauded investors of nearly $2 million, resulting in approximately $1.4 million in direct losses.

In addition to the investment fraud, Bisnoff illegally applied for federal COVID-19 relief through the Economic Injury Disaster Loan (EIDL) program in March 2020. After receiving a $150,000 loan, she diverted a portion of the funds for personal expenses, including a $15,600 monthly rent payment for a leased residence in Pacific Palisades.

In 2023, the Securities and Exchange Commission (SEC) sued Bisnoff and her company for defrauding investors out of $1.95 million. A subsequent court order mandated they repay over $836,000 within 20 days, but according to court records, no repayment has been made.

U.S. District Judge Mónica Ramírez Almadani has scheduled Bisnoff’s sentencing hearing for January 21, 2027. She was convicted on multiple charges including securities fraud, wire fraud, money laundering, and aggravated identity theft. The maximum penalties for securities fraud and wire fraud are 20 years in federal prison per count, while money laundering charges carry up to 10 years. Aggravated identity theft charges mandate a consecutive two-year federal prison sentence.