Ryan Wear sold more than 15,000 water vending machines to roughly 250 investors and collected $275 million ($275 million — more than the gross domestic product of several small island nations) — but Water Station Management never placed more than 2,600 machines anywhere in the entire country, and most of those that did exist were sold to multiple investors at the same time.

A Business Built on Fiction From Day One

Ryan Wear founded Creative Technologies in 2013 and Water Station Management in 2016. The pitch was simple and, on the surface, believable: Wear’s company would manufacture water filtration vending machines, place them in grocery stores, gas stations, discount retailers, and fitness centers across the country, and split the revenue with investors. Investors would own the machines and collect passive monthly income. They would never need to lift a finger.

Wear personally signed every purchase order, every service agreement, every franchise agreement, and every withdrawal request throughout the entire fraud. He was not a distant figurehead. He was the architect, the executor, and the primary beneficiary. His signature is on the documents that lied to investors. His fingerprints are on every dollar that moved.

The investment was marketed as a “truly passive, turnkey investment” that was “ideal for the passive investor.” Defendants’ own brochures promised investors the ability to “maintain current activities without the responsibilities to carry out the day-to-day operations.” That language was designed to put investors at ease. The more passive investors felt, the less they would scrutinize what Wear was actually doing with their money.

Veterans Were Specifically Targeted

Wear coordinated with veterans’ business advocacy groups to specifically recruit former military members. Veterans received preferential terms: lower minimum investments, higher guaranteed returns, exclusive low-interest or no-interest financing options repayable over ten years. The targeting of veterans was deliberate. People who served their country were offered the appearance of security and passive income in exchange for their savings.

At least 127 investors took out SBA loans totaling approximately $102 million ($102 million — enough to fully fund the Veterans Administration hospital system in a mid-sized state for an entire year) to finance their investments. To access those government-backed loans, Wear set up a franchise structure with a Water Station affiliate called WST Franchise Systems LLC. The SBA’s own rules prohibited loans for securities purchases — but allowed them for “franchise” opportunities. Wear used that loophole deliberately. The franchise wrapper was not a real business model. It was a legal technicality engineered to unlock federal loan money for a Ponzi scheme.

The Numbers That Expose Everything

Defendants purported to sell more than 15,000 water machines. In reality, Water Station placed at most approximately 2,600 machines at retail locations nationwide during the entire relevant period. Around 3,000 additional machines sat in warehouses, many only partially built and incapable of generating a single dollar of revenue. The gap between the promised 15,000 and the real-world 2,600 is the size of the fraud: a chasm of 12,400 machines that existed only on paper, in purchase orders, and in Machine Lists bearing Ryan Wear’s signature.

By October 2024, after the companies collapsed into bankruptcy and an independent officer took over, a final accounting of the vending management system found only 2,107 machines placed in retail locations across the entire country. Many of those were claimed by multiple creditors simultaneously, because Defendants sold the same machine to more than one investor. Dozens of single serial numbers were assigned to at least four investors at once. Investors who thought they owned a specific, uniquely identified machine in a specific store actually owned a number on a spreadsheet that Ryan Wear handed to several other people too.

Two Schemes, One Con: How Wear Kept the Plates Spinning

Scheme One: The Retail Hustle (2016–2023)

From September 2016 through September 2023, Wear’s retail scheme raised over $165 million ($165 million — enough to pay the annual salaries of 3,300 teachers) from approximately 250 investors. Each investor paid roughly $8,500 per machine, sometimes up to $10,000. They received purchase orders identifying machines by unique serial numbers, service agreements promising monthly income, and Machine Lists showing exactly which machines they owned and where those machines sat in stores across America. Every document was meticulously detailed. Every document was a lie.

Water Station guaranteed fixed annual returns ranging from 12% to 20% beginning around mid-2019. These were not projections or estimates. They were guarantees, in writing, signed by Wear. The only problem: the machine revenues never came close to covering those payments, because most of the machines generating those revenues did not exist. Wear covered the shortfall by doing what every Ponzi operator does: he paid old investors with new investors’ money.

Specific examples from the SEC complaint reveal the mechanics clearly. In July 2020, three investors wired approximately $300,000 into a Creative bank account. Wear transferred nearly a third of it to pay outstanding distributions that same day. Between August 21 and August 24, 2020, new investor funds received over that period covered over $90,000 in investor distributions. In March 2022, $340,000 in new investor money hit the account and was routed to existing investors and Wear’s side businesses within 48 hours. He also used $800,000 in investor funds to purchase a personal residence on Camino Island, Washington, in July 2020.

Scheme Two: The Note Scheme — Defrauding Institutions (2022–2024)

By April 2022, the retail scheme was hemorrhaging. Wear could not attract enough new retail investors to keep paying existing ones. His solution: target institutional investors with a bond product. On April 29, 2022, Water Station issued $71.25 million ($71.25 million — more than most Americans would earn in 1,400 lifetimes) in Notes to institutional buyers, with the Notes supposedly secured by Water Station’s water machine portfolio as collateral. Wear signed the indenture agreement on behalf of Water Station.

The institutional investors, including a community banking-focused financial services firm and affiliates of the Jefferies Financial Group, wired tens of millions of dollars into a segregated “Acquisition Account” that the indenture’s strict terms required to be used exclusively for purchasing new water machines. A Collateral Manager — an independent financial institution — reviewed every withdrawal request before money could leave the account. It was supposed to be airtight. Wear found a way through anyway: he fabricated everything.

Wear submitted invoices, purchase and sale agreements, and financial reports to the Collateral Manager and the Trustee bank that were entirely made up. They listed machines by serial number that either did not exist or had already been sold to retail investors. They listed placements at retailers that had never hosted a single Water Station machine. By April 2023, Water Station had withdrawn approximately $63.6 million ($63.6 million — enough to fund a new elementary school in every congressional district in California) from the Acquisition Account. Of that, Wear misappropriated and siphoned more than $59 million for purposes entirely unrelated to buying water machines.

The Retailer Fraud: A Numbers Game With No Equal

The table from the SEC complaint itself says everything. Wear told the Collateral Manager and Trustee that he had placed 7,466 machines across four specific national retailers. The actual number those same retailers hosted: 112. Retailer A was reportedly home to 3,367 machines; it actually hosted 112. Retailers B, C, and D were listed as hosting a combined 4,099 machines. They hosted zero.

More than 70% of the machines supposedly securing $111 million in institutional bonds were placed with retailers that had no relationship with Water Station, or virtually none. Wear reported $6.5 million in customer revenues for Retailer A between May 2022 and December 2023. The actual revenues from the 112 real machines? About $150,000. He told the trustee he paid Retailer A over $3 million in commissions. He actually paid $60,000. He pocketed the difference by funneling it out of a segregated account that institutional investors believed was under strict independent oversight.

The Non-Financial Ledger: The Cost That Doesn’t Fit in a Spreadsheet

The SEC complaint measures this fraud in dollar amounts. That’s appropriate. But the ledger entry that doesn’t appear in any balance sheet is the specific, personal, irreversible damage to the roughly 250 people who believed they were building something. Most of Wear’s retail investors were not hedge funds or Wall Street professionals. The complaint is explicit: Defendants “specifically targeted the veteran community.” They went to veterans’ business advocacy events. They offered preferential terms. They made veterans feel chosen, like this opportunity was built for them. It was built for Wear’s bank accounts.

Veterans who took out SBA loans to fund their investments did so under a franchise wrapper that Wear engineered specifically to bypass the SBA’s own rules against financing securities purchases. These investors now face the dual catastrophe of a worthless investment and a real federal debt. SBA loans must be repaid regardless of whether the business they financed succeeded or failed, regardless of whether that business was real. At least 127 veterans are carrying approximately $102 million ($102 million — more than enough to cover the monthly mortgage payments of 5,000 families for an entire year) in loan obligations tied to machines that were never built, never placed, and never generated a cent of income for them.

The promise of passive income is not a trivial thing to dangle in front of a veteran or a retiree. For many people, the prospect of steady monthly income from a managed asset is the difference between a dignified retirement and economic anxiety. Wear’s marketing language was surgical in its exploitation of that psychology. Terms like “truly passive,” “turnkey,” and “maintain current activities without the responsibilities to carry out day-to-day operations” were written for people who are tired, who have worked hard, and who want to believe they have finally earned a measure of financial security. Wear read that room and designed an entire fraud around it.

Investor C — described in the complaint as a private company focused on investing in water-related businesses — wired $32.2 million ($32.2 million — more than 640 Americans will earn in their entire working lives) to Water Station for 3,427 machines. Wear told Investor C those machines were being bought back from existing retail investors who had agreed to sell. He identified each machine by serial number and claimed location. At least 2,000 of the machines he sold to Investor C had already been pledged as collateral to the institutional Note investors. Approximately 600 of those machines didn’t exist at all. Investor C was sold the same fiction everyone else received, just at a much higher price point. When Investor C stopped receiving guaranteed monthly distributions and filed an arbitration claim in December 2023, Wear was already out of money to pay them.

The moment the Collateral Manager’s spot-check team visited 164 locations Water Station had certified as active machine sites, they found machines at exactly one. One out of 164. The Collateral Manager emailed Wear and told him that 3,000-plus machines securing the Notes were “actually missing” and gave him 90 days to account for them. Wear responded by cutting off the Collateral Manager’s access to Water Station’s own vending management system. He didn’t deny the machines were missing. He didn’t provide documentation. He blocked the investigators’ view and waited for time to run out. The 90-day cure period expired in November 2023. Wear offered nothing. The scheme finally collapsed under the weight of its own impossibility.

By mid-2024, the companies were in receivership. By August 2024, creditors had filed involuntary bankruptcy proceedings. Wear was removed from his managing partner role at both Water Station and Creative. The bankruptcy accounting published in April 2025 confirmed what investigators had suspected: as of October 2024, only 2,107 machines existed in retail locations across the entire country. Many were claimed by multiple creditors simultaneously. Warehouse inventories turned up roughly 2,700 more machines, many of them only partially assembled and inoperable. The SEC’s complaint was filed August 14, 2025. The victims have not recovered their money. As the complaint states plainly: “most Retail Scheme and Note Scheme investor victims have not recovered their investments.”

Legal Receipts: Direct From the Complaint

These are verbatim passages from the SEC’s complaint. Read them carefully. These are not paraphrases or summaries. This is what investigators documented.

Societal Impact: Who Gets Hurt When Fraud Goes This Big

Economic Inequality: The Rich Get Bailed Out, Everyone Else Gets Nothing

The $275 million ($275 million — enough to fully endow a community college that could offer free tuition to 55,000 students over a decade) that Wear extracted from this scheme did not flow downward. It flowed to his personal island home, to a snack vending company called Refreshing, to a real estate holding company called Ideal, and to warehouses Wear leased from his own companies. The complaint documents that Refreshing received $41.5 million ($41.5 million — more than 830 average American families earn in a year) in investor money and that Ideal received $6.2 million ($6.2 million — enough to pay the annual salaries of 100 public school teachers). Neither company provided any legitimate consideration for those funds. Both were majority-owned and controlled by Ryan Wear.

The investors left holding the bag are an unusually vulnerable population. The complaint documents that Wear specifically targeted veterans, coordinating with veterans’ business advocacy groups, and then engineered a fake franchise structure to funnel government-backed SBA loans into his fraud. At least 127 veterans borrowed approximately $102 million ($102 million — roughly the total annual budget of a small county government) through the SBA to invest. Those loans do not disappear because the investment was fraudulent. Those veterans now owe real money to real lenders for machines that do not exist. The economic damage is therefore compounded: investors lose their principal, and many carry ongoing debt obligations that will affect their finances for years or decades.

The institutional investors — including affiliates of the Jefferies Financial Group — had resources to pursue litigation and did so. Individual retail investors, many of whom invested savings or retirement funds, have far fewer tools at their disposal. The bankruptcy proceeding is active, but as the complaint acknowledges, “most Retail Scheme and Note Scheme investor victims have not recovered their investments.” When financial fraud targets working people and veterans with marketing language designed to exploit their specific psychology, and those people then lose their savings to a scheme while a single founder pockets the proceeds and buys a house on an island, that is economic inequality operating at its most precise and cruel.

Public Health: The Fraud That Corrupted a Consumer Water Product

Water Station Management’s machines were supposed to be consumer-facing public health infrastructure: filtered water vending at grocery stores, fitness centers, and discount retailers. Communities with limited access to affordable clean drinking water were part of the deployment network. When the complaint documents that roughly 3,000 machines existed in warehouses, many of them “only partially built or otherwise inoperable,” the public health dimension becomes clear. Resources that were supposed to expand access to filtered water in high-traffic retail environments were instead assembled incompletely, stored in warehouses, and left to generate nothing while Wear spent the corresponding investor dollars elsewhere.

The machines that did make it into the field — the roughly 2,600 actually placed at retail locations — were managed under a structure whose revenue collection was systemically falsified. Water Station reported to the Collateral Manager that machines at Retailer A had generated approximately $6.5 million in customer revenues between May 2022 and December 2023. The actual figure was about $150,000. The disconnect between reported and actual machine performance suggests that the real-world infrastructure — filter maintenance, collection of payments, servicing of machines — was chronically under-resourced relative to what Wear was telling investors and overseers. Machines that are not properly serviced do not produce clean water at the standard consumers expect from a filtered water product.