U.S. Department of Justice

United States Attorney James T. Jacks
Northern District of Texas






FRIDAY, JULY 22, 2011






Defendant Michael R. Rouse, Co-Founder of the Golden Gate Real Estate
Investment Trust (REIT), Sentenced in Absentia

DALLAS — Michael R. Rouse, 56, was sentenced today, in absentia, by U.S. District Judge Barbara M G. Lynn to 210 months in federal prison and ordered to pay $1.9 million in restitution to the 62 identified victims of his crime, announced U.S. Attorney James T. Jacks of the Northern District of Texas. Rouse was convicted at trial in April 2011 on all nine counts of a superseding indictment charging various felony offenses related to his operation of the Golden Gate Real Estate Investment Trust (REIT). Rouse, formerly of Wellington, Florida, is a fugitive, and on the record today, Judge Lynn established that he had received notice of the sentencing, and that his absence was voluntary. Rule 43(c)(1)(B) of the Federal Rules of Criminal Procedure provides that a defendant in a noncapital case waives his right to be present is he is voluntarily absent from sentencing.

Rouse was convicted of one count of conspiracy to commit securities fraud, mail fraud and money laundering; two counts of securities fraud and aiding and abetting; five counts of mail fraud; and one count of money laundering. The government presented evidence that, during 2003 and 2004, Rouse and convicted co-conspirator James A. Testa, 61, of Carrollton, Texas, were founders and trustees of the Golden Gate REIT. During that period, Rouse and Testa, acting personally and through brokers, raised more than $2 million from investors by claiming that the REIT was a safe investment in real estate and real estate related assets. In fact, virtually none of the money was ever invested in anything connected with real estate. The only investments Rouse and Testa ever made were in foreign currency trading, and those investments failed completely.

The investors lost most or all of their money, while Testa and Rouse paid themselves handsome salaries and spent the investors’ funds on business and personal expenses, including Mercedes Benz automobiles that cost more than $125,000 each. Testa, who testified for the government at trial, pleaded guilty to one count of money laundering in 2009; he is scheduled to be sentenced on August 26, 2011.

The interagency Financial Fraud Enforcement Task Force was established by the President to lead an aggressive, coordinated, and proactive effort to investigate and prosecute financial crimes. The Task Force includes representatives from a broad range of federal agencies, regulatory authorities, inspectors general, and state and local law enforcement who, working together, bring to bear a powerful array of criminal and civil enforcement resources. The task force is working to improve efforts across the federal executive branch, and with state and local partners, to investigate and prosecute significant financial crimes, ensure just and effective punishment for those who perpetrate financial crimes, combat discrimination in the lending and financial markets, and recover proceeds for victims of financial crimes. For more information on the task force, visit

The Financial Fraud Enforcement Task Force in the Northern District of Texas includes representatives from the FBI, U.S. Postal Inspection Service, IRS-Criminal Investigation, U.S. Secret Service, U.S. Securities and Exchange Commission (SEC), Texas State Securities Board, Texas Attorney General, FDIC Office of Inspector General, Commodity Futures Trading Commission, Federal Reserve Board of Governors, Office of Thrift Supervision, Comptroller of the Currency, Financial Industry Regulator Authority, and National Futures Association.

The case was investigated by IRS-Criminal Investigation and the Texas State Securities Board. Assistant U.S. Attorney Alan M. Buie and Special Assistant U.S. Attorney Suzanne M. Steinmetz prosecuted.