South Jordan real estate mogul sentenced to federal prison

U.S. District Judge David Sam recently sentenced a South Jordan man to over six years in federal prison for wire fraud.

The man was charged with wire fraud in connection with an alleged real estate investment scheme.

The Utah Department of Justice reports that the 42-year-old South Jordan man will spend 78 months in prison and another 36 months on probation. He was sentenced last Monday in Salt Lake City.

The U.S. Attorney’s Office alleges that the man founded two companies, Twin Peaks Financial and MNK Investments, to take advantage of the booming Utah real estate market prior to 2008.

The man made the mistake of promising his investors unrealistic returns and his businesses quickly devolved into a Ponzi scheme.

Twin Peaks Financial focused on purchasing large subdivison projects of around 20 lots. The company was ill-equipped to deal with such large projects Twin Peaks’ cashflow quickly exceeded what was needed to sustain its business operations. This caused the man to determine that the company could only be sustained by continued investor cash flow.

Getting investors interested in an unprofitable business is hard, so the man admitted to falsifying and forging recording stamps on trust deeds. This resulted in multiple investors being secured by the same property.

“It’s difficult to know what was going through the defendant’s mind as he continuously lied to investors about the soundness of rolling over their investments and returns, knowing full well their investments were not even worth the paper on which fabricated trust deeds were printed and provided to investors,” Assistant U.S. Attorney Mark Y. Hirata wrote in the sentencing memorandum. “The defendant’s excuse of losing control of the business, while convenient, cannot mask his irrefutable knowledge of a failing business, bereft of profits, and his unmistakeable efforts to exploit investors willing to part with their hard-earned money, inheritances, and retirements so that they too could take advantage of the defendant’s genius in cornering Utah’s real estate market.”

The plea agreement indicates that the man accepted up to $49 million from investors during the course of his Ponzi scheme and making more than $37 million in Ponzi payments.

The Salt Lake City criminal defense team at Greg Smith & Associates handles wire fraud cases throughout Utah. If you or a loved one is under investigation or has been charged with wire fraud or being involved with a Ponzi scheme, call us at 801-651-1512 or contact us online.

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