Cal. This ruling concludes the federal criminal prosecution; civil proceedings in the United States Bankruptcy Court are ongoing. Toronto police have also been unable to account for several million dollars, which they believe was diverted to an offshore bank account in Panama. In an unusual turn, when it was revealed that at least 100,000 emus were abandoned and left to starve, the Indian government was forced to step in and purchase $200,000 in emergency rations to feed the emus. The scheme, which spanned decades, ultimately caused at least $17 billion in losses to thousands of investors. This case is the product of an investigation by the Federal Bureau of Investigation and the Internal Revenue Service, Criminal Investigation. watch now. What Is the Kenvue IPO Price Range? Defendant is currently serving his sentence at USP Lompoc. Show Crime Records Powered by. This ruling concludes the federal criminal prosecution; civil proceedings in the United States Bankruptcy Court are ongoing. Joseph W. Martini, Wiggin and Dana LLP, Stamford, CT. From 2005 to 2010, the Hibberts oversaw a congregation at the Masonic Church of God in Torontos east end. We are pleased to have played a part in bringing Mr. Wannakuwatte to justice and value our cooperative working relationships with the U.S. Attorneys Office, FBI, and IRS-CI.. Assistant United States Attorney Michael M. Beckwith is prosecuting the case. In exchange for their investment, Rocco promised investors annual returns ranging from 15% to 18%. After college, he moved to Sacramento, started his company and became a fixture on the areas tennis scene. (Id.) U.S. Attorney's Office, Eastern District of California, Domestic Violence, Child Exploitation, and Human Trafficking Prevention, Sacramento Businessman Indicted For Bank Fraud, Mexican National Residing in Bakersfield Sentenced to 18 Months in Prison for Illegal Cockfighting in Violation of the Animal Welfare Act, Laser Strikes on Kern County Sheriff Helicopter Lead to Prison Sentence, Federal Agent Pleads Guilty to Making False Statements in Connection with a Sexual Relationship with a Victim Witness. (David Becker/Las Vegas Review-Journal File) | Las Vegas Review-Journal. The FBI joined forces with IRS and VA investigators and began looking at Wannakuwatte, his businesses, and his financials. The Court acknowledges USP Lompoc has had one of the worst COVID-19 outbreaks of any federal prison. U.S. Attorney's Office, Eastern District of California, Domestic Violence, Child Exploitation, and Human Trafficking Prevention, Former Owner Of Sacramento Capitals Tennis Team Sentenced To 20 Years In Prison For Fraud Scheme Exceeding $100Million In Losses, Mexican National Residing in Bakersfield Sentenced to 18 Months in Prison for Illegal Cockfighting in Violation of the Animal Welfare Act, Laser Strikes on Kern County Sheriff Helicopter Lead to Prison Sentence, Federal Agent Pleads Guilty to Making False Statements in Connection with a Sexual Relationship with a Victim Witness. But on the heels of a joint investigation with the Internal Revenue Service-Criminal Investigation (IRS-CI) and the Department of Veterans Affairs Office of Inspector General (VA-OIG), Wannakuwattewho pled guilty last yeargot his comeuppance: He was ordered by a federal judge last month to pay millions in restitution to his victims. . Based on the record before it, the Court cannot say that the past prevalence of the disease at USP Lompoc puts Defendant at great and particularized risk. Wannakuwatte will be sentenced July 24 by U.S. District Judge Troy Nunley. Deepal Wannakuwatte, the former owner of the now-defunct Sacramento Capitals professional tennis team, was sentenced to 20 years in prison Thursday for perpetrating one of the costliest Ponzi. A lock () or https:// means you've safely connected to the .gov website. Prosecutors have said the net loss to investors came to $109 million. But the hourlong hearing in U.S. District Court didnt lack for drama. Todays order brings to an end the criminal proceedings against Mr. Wannakuwatte, who operated the largest Ponzi scheme in Sacramento history, said U.S. Attorney Wagner. SACRAMENTO, Calif. Deepal Wannakuwatte, 63, of Sacramento, was charged today in a three-count indictment returned today with bank fraud and making false statements to a financial institution, United States Attorney Benjamin B. Wagner announced. This equates to roughly $6.3 billion per year of investor wealth lost to Ponzi schemes or nearly the annual GDP of Africas Republic of Niger. SACRAMENTO, CAOn Thursday, a federal judge ordered Deepal Wannakuwatte, 64, of Sacramento, to pay $108,199,425 in restitution to victims of his long-running fraud scheme, United States Attorney. However, in August 2012, the Securities and Exchange Commission initiated an emergency civil enforcement action and accused ZeekRewards and its founder, Paul Burks, of masterminding a massive Ponzi scheme that was on the verge of collapse. Dressed in a grubby jail-issued orange jumpsuit, Wannakuwatte, 63, pleaded guilty Thursday to a single count of wire fraud in U.S. District Court. Official websites use .gov FBI.gov is an official site of the U.S. Department of Justice. In sentencing Wannakuwatte, Judge Nunley told the defendant, You embody true evil. In addition to fulfilling their divine duties, Mr. Hibbert told parishioners he could generate monthly returns of up to 8.5% through his skills as a foreign currency trader. . You are a liar, a serial liar. The letter was read aloud by Assistant U.S. Attorney Kevin Khasigian. Defendant also emphasizes he previously tested positive for COVID-19. Wannakuwatte was born in Sri Lanka and moved to Georgia to play tennis in college. This case was the product of an investigation by the Federal Bureau of Investigation, the Internal Revenue Service, Criminal Investigation, and the Federal Deposit Insurance Corporation, Office of Inspector General, Office of Investigations. And in 2012, Bank of Internet issued a $1.26 million mortgage to Deepal Wannakuwatte, a Sacramento businessman who received a 20-year prison sentence last year for operating, for more than 10 . Barely three months ago, Deepal Wannakuwatte was the picture of success: owner of a medical-supply company and of the Sacramento Capitals professional tennis team. In addition to the prison term, United States District Judge Troy L. Nunley ordered Wannakuwatte to forfeit multiple properties, vehicles, business interests, and bank accounts to be used to provide restitution to victims. Make your practice more effective and efficient with Casetexts legal research suite. Then last week he turned the. Although Defendant claims to suffer from multiple, serious medical conditions, he fails to submit any medical documentation to confirm that he actually suffers from those conditions. Any sentence, however, would be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables. Wannakuwatte ran a Ponzi scheme in California through his company, International Manufacturing Groupone where money from new investors goes to interest payments from older investorsfor nearly a decade before the scam imploded in 2014. Assistant United States Attorneys Michael Beckwith and Kevin Khasigian are prosecuting the case. 5 Hypergrowth Stocks With 10X Potential in 2023, purchase $200,000 in emergency rations to feed the emus, a $3 million private plane that had been pledged as collateral., beneficiary of an investment by Barbara Corcoran, Penny Stocks How to Profit Without Getting Scammed, When Fraud Bites Business: Lost Fortunes, Reputations and Lives, 3 Big Ways That Medicare Fraudsters Rip You Off, Even if Block Beats on Earnings, Stay Away From SQ Stock, Louis Navellier and the InvestorPlace Research Staff, Rare Stock Indicators Show the Market Is About to Skyrocket, Ideanomics (IDEX) Stock Surges 90% Ahead of Possible Delisting, MULN Stock Alert: UNC Charlotte Orders Mullen Vans. According to court documents, from 2002 to 2014, Wannakuwatte convinced nearly 200 victims, including individuals, corporate entities, and financial institutions, to invest in a number of business opportunities by misrepresenting the financial worth of himself and his companies. (ECF No. ), Generally, a court "may not modify a term of imprisonment once it has been imposed." SACRAMENTO, Calif. Deepal Wannakuwatte, 63, of Sacramento, was sentenced today to 20 years in prison for a long-running fraud scheme, announced United States Attorney Benjamin B. Wagner, Special Agent in Charge Monica M. Miller of the FBIs Sacramento Field Office, Acting Special Agent in Charge Thomas McMahon for the IRS-Criminal Investigation, and Special Agent in Charge Wade V. Walters of the Federal Deposit Insurance Corporation Office of Inspector General. In total, Sundown raised more than $7 million from over 150 investors. Wannakuwatte took over the Capitals in 2012 after previous owner Bob Cook filed for bankruptcy protection. - Check with a trusted financial adviser, broker, or attorney about any investments you are considering. emailStay Connected UNITED STATES OF AMERICA, Plaintiff, v. DEEPAL WANNAKUWATTE, Defendant. A lock () or https:// means you've safely connected to the .gov website. The video promised that the VCMs would generate income for years, and promised that a $3,500 investment could produce huge returns. The alleged mastermind, Joseph Signore, is also accused of soliciting investors via emails that included a Bible passage intended to create a false sense of security and appeal to the religious beliefs of investors. 135.) GDC Stock Alert: Why Is GD Culture Group Up 700% Today? And he did a have contract with the VA, but it was only for up to $25,000 a year. The views expressed in this article are those of the author(s) and do not necessarily reflect the positions or policies of the American Bar Association, the Section of Litigation, this committee, or the employer(s) of the author(s). Modelled Revenue: # He falsely claimed that these companies did tens of millions of dollars in business with federal agencies every year, most notably the Department of Veterans Affairs. /// /// /// /// /// /// /// ///. The reason for the lower figure was that some investors got their money back. He is a shadow of the man. In return, those affiliates were handsomely rewarded with daily returns of 1.5%. Court records show that the companys revenue last year totaled less than $5 million. Nunley was unsparing as well, calling Wannakuwatte a liar and adding: Youre an evil person, theres no way you can get around that.. Heller denied that. While the company did sell latex gloves and did business with the VA, revenues were only a fraction of what he advertised and the business was in fact losing money. Bernie Madoff became a household name after his arrest in December 2008 for the largest Ponzi scheme in history. Financial Market Data powered by FinancialContent Services, Inc. All rights reserved. Based on the false representations, Bridge Bank authorized a line of credit worth $4.5 million. Contrary to his representations, Wannakuwatte used much of the money he obtained to pay himself and his family, make lulling payments to participants in his fraudulent investment schemes, and pay outstanding debts unrelated to his false representations. - And if you think youve been scammed, report it to the Securities and Exchange Commission, your states securities regulator, or a law enforcement agency. The warden denied Defendant's request on May 13, 2020. American Greed airs Thursdays at 10pm on CNBC. Get FBI email alerts The most striking moment came when Ron Ashley of San Rafael, who lost $22 million in the decadelong scheme, turned away from U.S. District Judge Troy Nunley to look directly at Wannakuwatte. He is scheduled to be arraigned on March 21, 2014. The case is tied to his medical-supply business, International Manufacturing Group. This story was originally published May 8, 2014, 12:11 PM. Although prosecutors have said Wannakuwatte lured investors and lenders into giving him around $150 million, Wagner pegged the actual net loss at around $100 million. The Sentencing Commission's relevant policy statement on compassionate release identifies medical conditions that satisfy the "extraordinary and compelling" requirement. In total, authorities estimated that Susi Farms took in more than $100 million from at least 8,000 investors. Deepal took full advantage of him in any way he could, she wrote. As a whole, Defendant's arguments about COVID-19 are too general and wide-ranging. Victims are expected to recover at least 50% of their losses. See, e.g., United States v. Eberhart, No. In a series of lawsuits in U.S. Bankruptcy Court, trustee Beverly McFarland has sued several victims of disgraced tennis-team owner Deepal Wannakuwatte, who was sentenced to 20 years in prison. The three later entered into plea agreements with prosecutors, resulting for prison terms for the husband and son and a suspended sentence for the wife. Share on Facebook Facebook 1125 N. Charles St, Baltimore, MD 21201. They all painted a picture of a man who preyed on mostly elderly investors and duped many of them out of their retirement savings. 138.) As it is, the Court has no way of knowing the extent of Defendant's hypertension, and Defendant fails to provide any evidence to confirm the existence or extent of his other alleged medical conditions. Defendant is 69 years old and claims he is particularly vulnerable to COVID-19 because he suffers from multiple medical conditions, including serious lung disorders, a severely compromised immune system, hypertension, and gastrointestinal bleeding. 20.) The exposure was gigantic, Heller said. He essentially overpaid, using the victims money, said U.S. Attorney Benjamin Wagner at a news conference following Wannakuwattes court appearance. Investors are promised above-average returns that generally carry little risk. Your membership has expired - last chance for uninterrupted access to free CLE and other benefits. Compare with Westlaw Troy L. Nunley United States District Judge ORDER This matter is before the Court on Defendant Deepal Wannakuwatte's ("Defendant") Motion for Compassionate Release Pursuant to 18 U.S.C. His partner in the Capitals, a Fair Oaks man named Ramey Osborne, wound up loaning Wannakuwatte about $456,000, according to bankruptcy court records. A .gov website belongs to an official government organization in the United States. [3] See also [ edit] Tennis portal Because of the length of the scheme, nearly half of Madoffs investors ended up receiving cumulative interest payments exceeding their total investment. Among his victims were banks, an Indian tribe in Washington state, as well as roughly 150 individuals. He further avowed that these companies had annual revenues in the tens of millions of dollars. KVUE Stock IPO: When Does Kenvue Go Public? 3582 (C) (1) (A) (i). Id. SACRAMENTO, Calif. Deepal Wannakuwatte, 63, of Sacramento, was charged today in a three-count indictment returned today with bank fraud and making false statements to a financial institution, United States Attorney Benjamin B. Wagner announced. The conference call was made to verify the authenticity of the $25 million accounts receivable ledger provided by Wannakuwatte. Several years later, Rocco revealed that a rival Indian tribe had stolen approximately $4 million to $5 million of uninsured cigarette inventory from the reservation, resulting in a total loss to investors. After his arrest, the World TeamTennis league revoked his franchise and disbanded the team. This included schemes from nearly every U.S. state only eight states did not record a hit on our database. . (ECF No. A former owner of the Sacramento Capitals professional tennis team, Wannakuwatte purchased properties in Hawaii, Oregon and California. Deepal Wannakuwatte. In that position, Rocco solicited club members to invest in his company, Limestone Capital Services, which they were told provided wholesale financing of cigarette purchases for a tobacco shop located on the Shinnecock Native American Reservation. Court:UNITED STATES DISTRICT COURT EASTERN DISTRICT OF CALIFORNIA. (ECF No. In 2014, the 63-year-old Wannakuwatte was sentenced to 20 years in jail. How to Send Money To Deepal Wannakuwatte's Inmate Trust Fund! Sundown lured investors by promising returns on short-term investments of up to 150%. Experts said it would have been difficult for Wannakuwatte to withdraw his guilty plea, and his new lawyer, Cozens, announced to the court in September that his client was ready to be sentenced. Finally, the toll on the criminal justice system is also noteworthy. Additionally, Hibbert and his wife diverted investor funds for their own personal use, including the purchase of luxury automobiles and real estate. Share sensitive information only on official, secure websites. These individuals collectively are associated with 20 companies in 10 cities. A hearing has been set for Jan. 15 to sort out the discrepancy. . {{currentYear}} American Bar Association, all rights reserved. Rather than having annual sales of $100 million, it appeared that annual sales were closer to $25,000. The investigation determined that Wannakuwatte told his investors that two of his companies were involved in the international sale of latex gloves and that it did business with government agencies, in particular the Department of Veterans Affairs (VA). I ask forgiveness, said Wannakuwatte, who will be eligible for parole in 17 years. SACRAMENTO, CAOn Thursday, a federal judge ordered Deepal Wannakuwatte, 64, of Sacramento, to pay $108,199,425 in restitution to victims of his long-running fraud scheme, United States Attorney Benjamin B. Wagner announced today. 3582(c)(1)(A). Fax Line:(916) 554-2900. It's time to renew your membership and keep access to free CLE, valuable publications and more. Troy L. Nunley United States District Judge, This matter is before the Court on Defendant Deepal Wannakuwatte's ("Defendant") Motion for Compassionate Release Pursuant to 18 U.S.C. The total losses to investor victims exceeds $100 million. watch now. Jul. 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