{"id":17835,"date":"2015-11-30T19:58:13","date_gmt":"2015-12-01T03:58:13","guid":{"rendered":"https:\/\/cjnotebook.com\/?p=17835"},"modified":"2015-11-30T19:59:40","modified_gmt":"2015-12-01T03:59:40","slug":"man-ran-ponzi-scheme-resulted-15-million-losses-sentenced-federa-prison","status":"publish","type":"post","link":"https:\/\/cjnotebook.com\/?p=17835","title":{"rendered":"Man Who Ran Ponzi Scheme That Resulted in $15 Million in Losses Sentenced to Federal Prison"},"content":{"rendered":"

LOS ANGELES<\/strong><\/span><\/p>\n

\n

\"u.s.DISTRICT<\/a>An Orange County man who operated a Ponzi scheme that bilked victims out of more than $15 million with false promises of large returns from investments in debt obligations and <\/span>distressed real estate was sentenced today to four years and nine months in federal prison, officials said today.<\/span><\/p>\n

U.S. District Court Judge Margaret M. Morrow\u00a0<\/strong>sentenced William Donnelly Yotty<\/strong>, 69, who lived in Lodi when he was operating the scheme, and was living in Monarch Beach.<\/span><\/p>\n

\"William<\/a>
William Donnelly Yotty<\/figcaption><\/figure>\n

In addition to the prison term of nearly five years, Judge Morrow ordered Yotty to pay $15 million in restitution to approximately 240 victims.<\/span><\/p>\n

He was arrested in this case in May 2014.<\/span><\/p>\n

\u201cIt is important that people who engage in business frauds face substantial sentences,\u201d Judge Morrow said, noting that Yotty\u2019s victims included the elderly, teachers and law enforcement officers, many of whom earned modest salaries or had lost their retirement savings.<\/span><\/p>\n

The daughter of an elderly couple told the judge that her parents lost $250,000 in the fraud, they were forced to move out of their home, and her 71-year-old father could not afford to retire.<\/span><\/p>\n

Yotty has been held without bond since his arrest, pleaded guilty in August to mail fraud and wire fraud charges, according to authorities.<\/span><\/p>\n

\u201cYotty raised over $17 million from more than 240 victim-investors based on false representations about \u2013 among other things \u2013 the safety of the investors\u2019 principal and the guaranteed rate of return on promissory notes and other financial instruments, and the surefire success of investments in a real estate venture,\u201d prosecutors wrote in a sentencing brief filed with the court.<\/span><\/p>\n

When he pleaded guilty, <\/span>Yotty admitted that he ran several Lodi-based companies that offered bogus investments in corporate debt obligations and in <\/span>distressed real estate that he and his salespeople said could be \u201cflipped\u201d for substantial\u00a0<\/span>profit, offficials said.<\/span><\/p>\n

\u201cThis defendant stole not only his victims\u2019 money, he stole their futures and their security,\u201d said U.S. Attorney Eileen M. Decker<\/strong>. \u201cThis defendant\u2019s fraud scheme has earned him a significant federal prison sentence which should stand as a warning to others that fraud does not pay.\u201d<\/span><\/p>\n

In the first scheme, \u00a0officials said Yotty solicited nearly $11 million from investors by offering safe and lucrative investments in convertible debentures, promissory <\/span>notes and other financial instruments.<\/span><\/p>\n

\"courtroom_02\"<\/a>Using companies he operated under names such as The Money People, Inc.,<\/strong> Yotty solicited money from victims by guaranteeing annual interest rates as high as 25 percent and promising that victims would also recoup their entire initial investments, authorities said.<\/span><\/p>\n

These claims were false.<\/span><\/p>\n

Yotty started using new investor money to make required payments to prior investors in the spring of 2007 \u2013 less than a year after he started offering the investments. Yotty stopped making any payments to investors in the summer of 2009, officials said.<\/span><\/p>\n

In the second investment scheme, which started in the summer of 2007 and was run through at least two programs \u2013 one of which he called Fortuno Millionaire Club \u2013 Yotty offered victims the opportunity to purchase foreclosed real estate at below-market prices.<\/span><\/p>\n

It would allow them to resell, or \u201cflip,\u201d the properties at two or three times their purchase price, officials said.<\/span><\/p>\n

At presentations, according to the sentencing memo, prospective investors were <\/span>told \u201cOur club member receives the down payment, the monthly payments from the new buyer, and all the proceeds from the sale of the Note! It\u2019s a win\u2026win\u2026win!\u201d<\/span><\/p>\n

In fact, <\/span>Yotty himself was flipping properties he purchased \u2013 many of which were in Flint, Michigan \u2013 to investors at substantial profits for himself, officials said.<\/span><\/p>\n

Because <\/span>Yotty had already extracted any profit to be made from the properties, the investors were left with <\/span>dilapidated real estate that they could not sell at all, let alone at the substantial profit that Yotty<\/span>\u00a0had promised.<\/span><\/p>\n

As part of the scheme, Yotty concealed from the investors that the price they were paying for the properties was double or triple what Fortuno had paid,<\/span>\u00a0and that this inflated price would prevent the victims from realizing any profit of their own, officials said.<\/span><\/p>\n

As a further inducement to invest in Fortuno, <\/span>Yotty and his salespeople also falsely promised victims that the properties were in livable condition and that Fortuno would manage the properties until the promised resale.<\/span><\/p>\n

According to prosecutors, one victim, who was 79 when she invested in the Fortuno program, received a letter from the City of Flint that one of her two properties was condemned and going to be demolished, and the second property was in such bad shape that it could never be rented out or solid, officials said.<\/span><\/p>\n

 <\/p>\n","protected":false},"excerpt":{"rendered":"

An Orange County man who operated a Ponzi scheme that bilked victims out of more than $15 million with false promises of large returns from investments in debt obligations and distressed real estate.<\/p>\n","protected":false},"author":1,"featured_media":11510,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[16,3],"tags":[],"class_list":["post-17835","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-home-main-slider","category-u-s-department-of-justice"],"yoast_head":"\nMan Who Ran Ponzi Scheme That Resulted in $15 Million in Losses Sentenced to Federal Prison<\/title>\n<meta name=\"description\" content=\"An Orange County man who operated a Ponzi scheme that bilked victims out of more than $15 million with false promises of large returns from investments in debt obligations and distressed real estate.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/cjnotebook.com\/?p=17835\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Man Who Ran Ponzi Scheme That Resulted in $15 Million in Losses Sentenced to Federal Prison\" \/>\n<meta property=\"og:description\" content=\"An Orange County man who operated a Ponzi scheme that bilked victims out of more than $15 million with false promises of large returns from investments in debt obligations and distressed real estate.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/cjnotebook.com\/?p=17835\" \/>\n<meta property=\"og:site_name\" content=\"American Justice Notebook\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/AmericanJusticeNotebook\" \/>\n<meta property=\"article:published_time\" content=\"2015-12-01T03:58:13+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2015-12-01T03:59:40+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/cjnotebook.com\/wp-content\/uploads\/2015\/04\/PONZI-SCHEME-.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"620\" \/>\n\t<meta property=\"og:image:height\" content=\"349\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"Raul\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Raul\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"4 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\\\/\\\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\\\/\\\/cjnotebook.com\\\/?p=17835#article\",\"isPartOf\":{\"@id\":\"https:\\\/\\\/cjnotebook.com\\\/?p=17835\"},\"author\":{\"name\":\"Raul\",\"@id\":\"https:\\\/\\\/cjnotebook.com\\\/#\\\/schema\\\/person\\\/f5521baddca77b521f012298775186c0\"},\"headline\":\"Man Who Ran Ponzi Scheme That Resulted in $15 Million in Losses Sentenced to Federal Prison\",\"datePublished\":\"2015-12-01T03:58:13+00:00\",\"dateModified\":\"2015-12-01T03:59:40+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\\\/\\\/cjnotebook.com\\\/?p=17835\"},\"wordCount\":782,\"commentCount\":0,\"publisher\":{\"@id\":\"https:\\\/\\\/cjnotebook.com\\\/#organization\"},\"image\":{\"@id\":\"https:\\\/\\\/cjnotebook.com\\\/?p=17835#primaryimage\"},\"thumbnailUrl\":\"https:\\\/\\\/cjnotebook.com\\\/wp-content\\\/uploads\\\/2015\\\/04\\\/PONZI-SCHEME-.jpg\",\"articleSection\":[\"Home Main Slider\",\"U.S. Department of Justice\"],\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"CommentAction\",\"name\":\"Comment\",\"target\":[\"https:\\\/\\\/cjnotebook.com\\\/?p=17835#respond\"]}]},{\"@type\":\"WebPage\",\"@id\":\"https:\\\/\\\/cjnotebook.com\\\/?p=17835\",\"url\":\"https:\\\/\\\/cjnotebook.com\\\/?p=17835\",\"name\":\"Man Who Ran Ponzi Scheme That Resulted in $15 Million in Losses Sentenced to Federal Prison\",\"isPartOf\":{\"@id\":\"https:\\\/\\\/cjnotebook.com\\\/#website\"},\"primaryImageOfPage\":{\"@id\":\"https:\\\/\\\/cjnotebook.com\\\/?p=17835#primaryimage\"},\"image\":{\"@id\":\"https:\\\/\\\/cjnotebook.com\\\/?p=17835#primaryimage\"},\"thumbnailUrl\":\"https:\\\/\\\/cjnotebook.com\\\/wp-content\\\/uploads\\\/2015\\\/04\\\/PONZI-SCHEME-.jpg\",\"datePublished\":\"2015-12-01T03:58:13+00:00\",\"dateModified\":\"2015-12-01T03:59:40+00:00\",\"description\":\"An Orange County man who operated a Ponzi scheme that bilked victims out of more than $15 million with false promises of large returns from investments in debt obligations and distressed real estate.\",\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"ReadAction\",\"target\":[\"https:\\\/\\\/cjnotebook.com\\\/?p=17835\"]}]},{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\\\/\\\/cjnotebook.com\\\/?p=17835#primaryimage\",\"url\":\"https:\\\/\\\/cjnotebook.com\\\/wp-content\\\/uploads\\\/2015\\\/04\\\/PONZI-SCHEME-.jpg\",\"contentUrl\":\"https:\\\/\\\/cjnotebook.com\\\/wp-content\\\/uploads\\\/2015\\\/04\\\/PONZI-SCHEME-.jpg\",\"width\":620,\"height\":349},{\"@type\":\"WebSite\",\"@id\":\"https:\\\/\\\/cjnotebook.com\\\/#website\",\"url\":\"https:\\\/\\\/cjnotebook.com\\\/\",\"name\":\"American Justice Notebook\",\"description\":\""Our liberty depends on the freedom of the press, and that cannot be limited without being lost." \u2014 Thomas Jefferson\",\"publisher\":{\"@id\":\"https:\\\/\\\/cjnotebook.com\\\/#organization\"},\"potentialAction\":[{\"@type\":\"SearchAction\",\"target\":{\"@type\":\"EntryPoint\",\"urlTemplate\":\"https:\\\/\\\/cjnotebook.com\\\/?s={search_term_string}\"},\"query-input\":{\"@type\":\"PropertyValueSpecification\",\"valueRequired\":true,\"valueName\":\"search_term_string\"}}],\"inLanguage\":\"en-US\"},{\"@type\":\"Organization\",\"@id\":\"https:\\\/\\\/cjnotebook.com\\\/#organization\",\"name\":\"American Justice Notebook\",\"url\":\"https:\\\/\\\/cjnotebook.com\\\/\",\"logo\":{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\\\/\\\/cjnotebook.com\\\/#\\\/schema\\\/logo\\\/image\\\/\",\"url\":\"https:\\\/\\\/cjnotebook.com\\\/wp-content\\\/uploads\\\/2014\\\/07\\\/Justice-Scales.jpg\",\"contentUrl\":\"https:\\\/\\\/cjnotebook.com\\\/wp-content\\\/uploads\\\/2014\\\/07\\\/Justice-Scales.jpg\",\"width\":675,\"height\":231,\"caption\":\"American Justice Notebook\"},\"image\":{\"@id\":\"https:\\\/\\\/cjnotebook.com\\\/#\\\/schema\\\/logo\\\/image\\\/\"},\"sameAs\":[\"https:\\\/\\\/www.facebook.com\\\/AmericanJusticeNotebook\"]},{\"@type\":\"Person\",\"@id\":\"https:\\\/\\\/cjnotebook.com\\\/#\\\/schema\\\/person\\\/f5521baddca77b521f012298775186c0\",\"name\":\"Raul\",\"image\":{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\\\/\\\/secure.gravatar.com\\\/avatar\\\/c7f80bd073aca2abc2fc18e390e13d00b72d9d3a81bca4fd53e3567b02efee6f?s=96&r=g\",\"url\":\"https:\\\/\\\/secure.gravatar.com\\\/avatar\\\/c7f80bd073aca2abc2fc18e390e13d00b72d9d3a81bca4fd53e3567b02efee6f?s=96&r=g\",\"contentUrl\":\"https:\\\/\\\/secure.gravatar.com\\\/avatar\\\/c7f80bd073aca2abc2fc18e390e13d00b72d9d3a81bca4fd53e3567b02efee6f?s=96&r=g\",\"caption\":\"Raul\"},\"description\":\"Raul Hernandez is a former journalist. He has worked as a newspaper reporter for more than 30 years at the El Paso Herald-Post, El Paso Times, Press Enterprise in Riverside, California and the Ventura County Star in California. He was a court reporter for more than 20 years.\",\"sameAs\":[\"https:\\\/\\\/cjnotebook.com\\\/\"]}]}<\/script>\n<!-- \/ Yoast SEO plugin. -->","yoast_head_json":{"title":"Man Who Ran Ponzi Scheme That Resulted in $15 Million in Losses Sentenced to Federal Prison","description":"An Orange County man who operated a Ponzi scheme that bilked victims out of more than $15 million with false promises of large returns from investments in debt obligations and distressed real estate.","robots":{"index":"index","follow":"follow","max-snippet":"max-snippet:-1","max-image-preview":"max-image-preview:large","max-video-preview":"max-video-preview:-1"},"canonical":"https:\/\/cjnotebook.com\/?p=17835","og_locale":"en_US","og_type":"article","og_title":"Man Who Ran Ponzi Scheme That Resulted in $15 Million in Losses Sentenced to Federal Prison","og_description":"An Orange County man who operated a Ponzi scheme that bilked victims out of more than $15 million with false promises of large returns from investments in debt obligations and distressed real estate.","og_url":"https:\/\/cjnotebook.com\/?p=17835","og_site_name":"American Justice Notebook","article_publisher":"https:\/\/www.facebook.com\/AmericanJusticeNotebook","article_published_time":"2015-12-01T03:58:13+00:00","article_modified_time":"2015-12-01T03:59:40+00:00","og_image":[{"width":620,"height":349,"url":"https:\/\/cjnotebook.com\/wp-content\/uploads\/2015\/04\/PONZI-SCHEME-.jpg","type":"image\/jpeg"}],"author":"Raul","twitter_misc":{"Written by":"Raul","Est. reading time":"4 minutes"},"schema":{"@context":"https:\/\/schema.org","@graph":[{"@type":"Article","@id":"https:\/\/cjnotebook.com\/?p=17835#article","isPartOf":{"@id":"https:\/\/cjnotebook.com\/?p=17835"},"author":{"name":"Raul","@id":"https:\/\/cjnotebook.com\/#\/schema\/person\/f5521baddca77b521f012298775186c0"},"headline":"Man Who Ran Ponzi Scheme That Resulted in $15 Million in Losses Sentenced to Federal Prison","datePublished":"2015-12-01T03:58:13+00:00","dateModified":"2015-12-01T03:59:40+00:00","mainEntityOfPage":{"@id":"https:\/\/cjnotebook.com\/?p=17835"},"wordCount":782,"commentCount":0,"publisher":{"@id":"https:\/\/cjnotebook.com\/#organization"},"image":{"@id":"https:\/\/cjnotebook.com\/?p=17835#primaryimage"},"thumbnailUrl":"https:\/\/cjnotebook.com\/wp-content\/uploads\/2015\/04\/PONZI-SCHEME-.jpg","articleSection":["Home Main Slider","U.S. Department of Justice"],"inLanguage":"en-US","potentialAction":[{"@type":"CommentAction","name":"Comment","target":["https:\/\/cjnotebook.com\/?p=17835#respond"]}]},{"@type":"WebPage","@id":"https:\/\/cjnotebook.com\/?p=17835","url":"https:\/\/cjnotebook.com\/?p=17835","name":"Man Who Ran Ponzi Scheme That Resulted in $15 Million in Losses Sentenced to Federal Prison","isPartOf":{"@id":"https:\/\/cjnotebook.com\/#website"},"primaryImageOfPage":{"@id":"https:\/\/cjnotebook.com\/?p=17835#primaryimage"},"image":{"@id":"https:\/\/cjnotebook.com\/?p=17835#primaryimage"},"thumbnailUrl":"https:\/\/cjnotebook.com\/wp-content\/uploads\/2015\/04\/PONZI-SCHEME-.jpg","datePublished":"2015-12-01T03:58:13+00:00","dateModified":"2015-12-01T03:59:40+00:00","description":"An Orange County man who operated a Ponzi scheme that bilked victims out of more than $15 million with false promises of large returns from investments in debt obligations and distressed real estate.","inLanguage":"en-US","potentialAction":[{"@type":"ReadAction","target":["https:\/\/cjnotebook.com\/?p=17835"]}]},{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/cjnotebook.com\/?p=17835#primaryimage","url":"https:\/\/cjnotebook.com\/wp-content\/uploads\/2015\/04\/PONZI-SCHEME-.jpg","contentUrl":"https:\/\/cjnotebook.com\/wp-content\/uploads\/2015\/04\/PONZI-SCHEME-.jpg","width":620,"height":349},{"@type":"WebSite","@id":"https:\/\/cjnotebook.com\/#website","url":"https:\/\/cjnotebook.com\/","name":"American Justice Notebook","description":""Our liberty depends on the freedom of the press, and that cannot be limited without being lost." \u2014 Thomas Jefferson","publisher":{"@id":"https:\/\/cjnotebook.com\/#organization"},"potentialAction":[{"@type":"SearchAction","target":{"@type":"EntryPoint","urlTemplate":"https:\/\/cjnotebook.com\/?s={search_term_string}"},"query-input":{"@type":"PropertyValueSpecification","valueRequired":true,"valueName":"search_term_string"}}],"inLanguage":"en-US"},{"@type":"Organization","@id":"https:\/\/cjnotebook.com\/#organization","name":"American Justice Notebook","url":"https:\/\/cjnotebook.com\/","logo":{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/cjnotebook.com\/#\/schema\/logo\/image\/","url":"https:\/\/cjnotebook.com\/wp-content\/uploads\/2014\/07\/Justice-Scales.jpg","contentUrl":"https:\/\/cjnotebook.com\/wp-content\/uploads\/2014\/07\/Justice-Scales.jpg","width":675,"height":231,"caption":"American Justice Notebook"},"image":{"@id":"https:\/\/cjnotebook.com\/#\/schema\/logo\/image\/"},"sameAs":["https:\/\/www.facebook.com\/AmericanJusticeNotebook"]},{"@type":"Person","@id":"https:\/\/cjnotebook.com\/#\/schema\/person\/f5521baddca77b521f012298775186c0","name":"Raul","image":{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/secure.gravatar.com\/avatar\/c7f80bd073aca2abc2fc18e390e13d00b72d9d3a81bca4fd53e3567b02efee6f?s=96&r=g","url":"https:\/\/secure.gravatar.com\/avatar\/c7f80bd073aca2abc2fc18e390e13d00b72d9d3a81bca4fd53e3567b02efee6f?s=96&r=g","contentUrl":"https:\/\/secure.gravatar.com\/avatar\/c7f80bd073aca2abc2fc18e390e13d00b72d9d3a81bca4fd53e3567b02efee6f?s=96&r=g","caption":"Raul"},"description":"Raul Hernandez is a former journalist. He has worked as a newspaper reporter for more than 30 years at the El Paso Herald-Post, El Paso Times, Press Enterprise in Riverside, California and the Ventura County Star in California. He was a court reporter for more than 20 years.","sameAs":["https:\/\/cjnotebook.com\/"]}]}},"_links":{"self":[{"href":"https:\/\/cjnotebook.com\/index.php?rest_route=\/wp\/v2\/posts\/17835","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/cjnotebook.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/cjnotebook.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/cjnotebook.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/cjnotebook.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=17835"}],"version-history":[{"count":12,"href":"https:\/\/cjnotebook.com\/index.php?rest_route=\/wp\/v2\/posts\/17835\/revisions"}],"predecessor-version":[{"id":17848,"href":"https:\/\/cjnotebook.com\/index.php?rest_route=\/wp\/v2\/posts\/17835\/revisions\/17848"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/cjnotebook.com\/index.php?rest_route=\/wp\/v2\/media\/11510"}],"wp:attachment":[{"href":"https:\/\/cjnotebook.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=17835"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/cjnotebook.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=17835"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/cjnotebook.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=17835"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}