To create the appearance of a successful business, Wannakuwatte is accused of doctoring actual invoices with significant markups. Real-time updates and all local stories you want right in the palm of your hand. Wannakuwatte told his victims that his Sacramento-based companiesInternational Manufacturing Group (IMG) and Relyaid Global Health Carewere involved in the international manufacture and sale of latex gloves. For example, one two-month period resulted in $8,000 in legitimate revenue and $1.7 million in new investments. Federal prosecutors said that, from 2002 to 2014, Wannakuwatte fraudulently raised $230 million from nearly 200 investors for his companies International Manufacturing Group and RelyAid Global. The tax refunds and other assets will be eventually distributed among his victims, but its all but certain they wont get full recovery. A hearing has been set for Jan. 15 to sort out the discrepancy. Many of these so-called net winners later faced clawback lawsuits by the court-appointed bankruptcy trustee seeking to recover funds for Madoffs victims who were not as fortunate. Fax Line:(916) 554-2900. 3582(C)(1)(A)(i). For more than decade, up until February 2014, Sacramento businessman (and Ponzi scammer extraordinaire) Deepal Wannakuwatte fooled his investors and his lenders into believing that he and his companies were worthy of their trust and their money. Investor funds were diverted for a variety of unauthorized purposes, including trips to the Bahamas, hundreds of thousands of dollars in gambling losses, and even the payment of rent for Steven Palladinos mistress. Prosecutors said at least 100 individuals and corporations were victimized by Wannakuwatte. These claims were not true but were made in order to appear more credit worthy. Although the government has initiated proceedings to seize his home in South Land Park, vacation properties in Hawaii and on the Oregon coast, and other assets, its considered unlikely that victims will receive more than pennies on the dollar. He was ordered by a federal judge last month to pay millions in restitution to his victims, FBI.gov is an official site of the U.S. Department of Justice. This ruling concludes the federal criminal prosecution; civil proceedings in the United States Bankruptcy Court are ongoing. Perhaps unsurprisingly, the overwhelming majority of Ponzi scheme perpetrators were males over 90%, to be exact. In 2013, Wannakuwatte claimed to have more than $125 million in VA contracts alone. Stock Market Crash Alert: Mark Your Calendars for May 3. He is a shadow of the man. For the foregoing reasons, the Court concludes Defendant is neither terminally ill nor subject to a serious or unrecoverable condition that substantially diminishes his ability to provide self-care within a BOP facility. In addition, Persaud touted his status as a certified financial planner to assure investors that their funds were safe. 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The case against Deepal Wannakuwatte was already one for the books: a successful immigrant businessman, owner of a professional tennis team, admitting he had perpetrated one of the largest Ponzi. Share sensitive information only on official, secure websites. UC Davis senior, 20, killed in weekend stabbing remembered as exceptional academic star, Swarms of quakes shake Salton Sea region in Southern California, seismologists say, Preschool teacher arrested during nap time after body found, California cops say, Second stabbing homicide at Davis park in 4 days UC Davis student identified as victim, No other way to say it: The moment was too big for the young Sacramento Kings | Opinion, Kings-Warriors: Domantas Sabonis says battered, bruised left eye hurts going into Game 7, California prison inmate dies at New Folsom in suspected homicide, officials say, Folsom police arrest Sacramento man on theft charges using GPS-tracked bait items, Sacramento PD rolls out new mobile police station to help reach residents, After high-speed chase near Sacramento, heres the hot spot CHP says motorcyclist was hiding, El Dorado man arrested after Roseville bank robbery. Defendant made a request to the warden on April 23, 2020. We are committed to aggressively pursue those who attempt to circumvent the law for personal gain., This case shows that the appearance of success can mask a tangled financial web of lies, said Acting Special Agent in Charge Thomas McMahon, IRS-Criminal Investigation. Wannakuwatte, dressed in his orange Sacramento County jailhouse uniform, sat at the defense table and stared at the floor as Ashley berated him. The letter was read aloud by Assistant U.S. Attorney Kevin Khasigian. As an aside, IMG actually had been in business for more than 25 years and actually did sell gloves and other supplies to businesses, including medical providers. . This case is 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. Your membership has expired - last chance for uninterrupted access to free CLE and other benefits. Upon receiving funds, Wannakuwatte used the money to pay outstanding debts unrelated to the purpose of the loan. 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). However, relief under 18 U.S.C. With time off for good behavior, he could be out of prison by the time hes 79 or 80, giving him the opportunity to see his grandchildren.. The. Authorities also filed criminal charges against financial juggernaut JPMorgan Chase (JPM), accusing the bank of turning a blind eye to Madoffs scheme while serving as his primary banker. To date, prosecutors have obtained at least 14 convictions including a guilty plea from Madoffs brother, Peter Madoff. Share sensitive information only on official, secure websites. Ironically, Steven Palladino was also accused of using investor funds to make court-ordered payments stemming from a previous conviction for defrauding an elderly relative. Based on the false representations, Bridge Bank authorized a line of credit worth $4.5 million. 2:14-cr-00067-TLN (E.D. Share on Twitter Twitter In the early 20th century, a little-known Italian immigrant gained international notoriety after his investment venture promising astronomical returns through the resale of postal reply coupons was proved to be mathematically impossible. While Sundown did actually engage in comic book production, the resulting revenues were not nearly enough to make the promised returns to investors. 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). ), No. Wannakuwatte will be sentenced July 24 by U.S. District Judge Troy Nunley. 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. D & A INTERNATIONAL IMPORT . 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. The conference call was made to verify the authenticity of the $25 million accounts receivable ledger provided by Wannakuwatte. 135.) The total losses to investor victims exceeds $100 million. Former Sacramento Capitals World TeamTennis owner Deepal Wannakuwatte was sentenced Thursday in federal court in Sacramento to 20 years in prison for his long-running fraud. 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. 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. 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. A .gov website belongs to an official government organization in the United States. Wannakuwattes companies, IMG and Relyaid, were involved in the international manufacture, shipment, and distribution of latex gloves. He was indicted in March. Of the roughly 510 schemes represented in the database, the average Ponzi scheme size was $98.3 million, while the median scheme size was $10 million. 1125 N. Charles St, Baltimore, MD 21201. No Thanks Interested congregants were required to invest at least $10,000 with Mr. Hibbert, and at least $8.6 million was raised from approximately 200 parishioners. The team was renamed the Las Vegas Neon. However, while IMG and RelyAid did have a business relationship with the USVA, authorities alleged that this relationship was grossly overstated. From behind cars, Deepal Wannakuwatte tries to convince his own mother his sentencing isn't nearly as bad as it sounds. Deepal Wannakuwatte, owner of the Las Vegas Neon, was arrested Thursday in Sacramento, Calif., on federal fraud charges. UNITED STATES DISTRICT COURT EASTERN DISTRICT OF CALIFORNIA. Persaud is currently serving a three-year sentence in federal prison. GDC Stock Alert: Why Is GD Culture Group Up 700% Today? A locked padlock There are 20 individuals that go by the name of Deepal Wannakuwatte. Deepal Wannakuwatte - 1 Criminal record(s) found. For example, a $257 invoice was modified to create a $12 million invoice. (ECF No. 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. 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. ) or https:// means youve safely connected to the .gov website. 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. 3582(c)(1)(A)(i). A North Carolina company known as ZeekRewards, or Zeekler, solicited investors worldwide to participate in its penny-auction business where participants could bid on popular merchandise in 1-cent increments. Potential investors were told that their investment would be used to purchase the rights to old film footage that then would be used to produce and distribute movies and documentaries. Persaud solicited investors by promising risk-free annual returns ranging from 6% to 18%, telling them he was able to generate such gains through trading in futures and other markets. No matter the type, a Ponzi scheme has a predictable and inevitable dire outcome, but some are certainly more notable than others. The bank settled the charges by paying over $2 billion in penalties. I ask forgiveness, said Wannakuwatte, who will be eligible for parole in 17 years. 3582(c)(1)(A) (requiring a consideration of the 3553(a) factors before granting compassionate release). On February 4, 2014, the Capitals, after 28 seasons in Sacramento, announced their move to Las Vegas. One spoke about having to delay retirement and sell his house to make ends meet. 138 at 9-15. You are a liar, a serial liar. A .gov website belongs to an official government organization in the United States. Wannakuwatte offered his investors several different bogus high-yield investment opportunities, most of which related to his purported relationship with the VA. And to prove his bona fides to potential investors and to lenders he was trying to borrow money from, he showed them phony corporate documents as well as actual personal and corporate tax returns where he had reported and paid taxes that falsely overstated his personal income and annual gross receipts and sales for IMG. Show Crime Records Powered by. Next: A Pastor And a $9 Million Foreign Currency Ponzi Scheme. An official website of the United States government. All told, the financial impact of Ponzi schemes is pegged at more than $50 billion over the past six years. 3582(c)(1)(A) is only available. (David Becker/Las Vegas Review-Journal File) | Las Vegas Review-Journal. From 2002 until his arrest in February 2014, Wannakuwatte defrauded between 150 and 200 individuals, companies, and government entities out of $230,000,000 through a classic Ponzi scheme. Another submitted a poem that called Wannakuwatte a miserable soul.. 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 schemes in the regions history. Get FBI email alerts . Secure .gov websites use HTTPS See U.S.S.G. For its part, the Government correctly notes that the presentencing report ("PSR") indicates Defendant underwent full knee replacement in 2012 and injured his left wrist in May 2014, but otherwise indicates Defendant is in good health. One of the properties Wannakuwatte hasnt yet surrendered is his West Sacramento medical company, whose assets were frozen after a group of investors sued. Among other things, Wannakuwatte was ordered to turn over a $3 million private plane that had been pledged as collateral.. Among his victims were banks, an Indian tribe in Washington state, as well as roughly 150 individuals. This New York investment adviser rose to prominence through high-profile leadership positions in the financial industry, including a stint as non-executive chairman of the Nasdaq Stock Exchange. The sentence wasnt a surprise; it matched the terms of a plea agreement Wannakuwatte made with prosecutors in May. 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. No Thanks As to his conditions of confinement, Defendant has not shown he is unable to manage his health conditions and minimize his risks through self-care. Get FBI email alerts /// /// /// /// /// /// /// ///. 135. 3582(c)(1)(A). I want to commend the FBI and IRS-CI for detecting and swiftly stopping this scheme before it caused even greater losses., Wanakuwattes victims individuals, businesses, government agencies, venture funds, and financial institutions suffered as his elaborate scheme collapsed. After the previous owner of the Capitals went bankrupt in 2011 and the team was in jeopardy, Wannakuwatte stepped in and kept the team alive. Ultimately, Wannakuwatte obtained well over $230 million from his victims.

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