If you run a business in California that involves taking money from investors with a promise of monetary returns, the law requires that you act in good faith to fulfill your promise. Because it is always possible for an investment to fail to yield expected profits you should not face any legal consequences if the money was properly allocated. However, if there are suspicions of impropriety, you may end up facing fraud charges.
Recently, a 55-year-old woman from Orange County entered a guilty plea in federal court for her role in an alleged Ponzi scheme involving real estate sales. According to a public affairs officer of the U.S. Attorney's Office, the woman held hotel seminars during which she solicited money from Southern California investors with the promise of paying them significant amounts from accrued interest from property investments.
Moreover, she is said to have claimed the money was secured by collateral provided by deeds of trust filed on properties. Yet the money was not secured by collateral, nor was it used to purchase new properties. All told, at least 50 investors lost almost $3.5 million collectively.
The woman pleaded guilty to a single count of wire fraud. She also had an accomplice whose trial is scheduled for later this year.
If your business has come under legal fire for allegedly defrauding investors, it is of the utmost importance that you begin to prepare an effective strategy to legally protect yourself. To be convicted of fraud charges, the prosecution must prove that it was your intent to take money without providing that which you promised.
An attorney can work on your behalf in an effort to demonstrate that regardless of the outcome of the transactions, you did not intend to renege on your agreement. And if it is in your best interests, the attorney can help you manage a plea agreement that minimizes your potential penalties.
Source: MyNewsLA.com, "Web of lies, Ponzi scheme in $3.5 million real estate scam," Debbie L. Sklar, Jan. 25, 2017