Ex-Financial Advisor with History of Professional Misconduct Arrested on Fraud Charges Alleging $14.5 Million Real Estate Scheme
RIVERSIDE, California – A former financial advisor with a lengthy disciplinary history was arrested today pursuant to a federal grand jury indictment charging him with running a $14.5 million real estate fraud scheme by inducing victims to invest in his businesses and then using their money for personal expenses, including the down payment on a home in Upland.
Paul Ricky Mata, 56, a former resident of Upland who now lives in Oceanside, is scheduled to be arraigned on the indictment this afternoon in United States District Court in Riverside.
Mata is named in a 17-count indictment that was returned by a federal grand jury on June 5. The indictment charges Mata with mail fraud, wire fraud, and making false statements in a bankruptcy proceeding, among other offenses. If convicted of all 17 counts, he would face a statutory maximum sentence of 295 years in federal prison.
According to the indictment, from August 2008 to September 2015, Mata caused victims to invest in several of his businesses, including Secured Capital, Logos Real Estate and other ventures. Mata failed to disclose his disciplinary history to his victims, including his 2009 termination from Ameriprise Financial Services, Inc. for violating company policies, the indictment alleges. Mata also allegedly failed to disclose other disciplinary actions against him, including ones filed by the states of Nevada and California, and a one-year suspension and $10,000 fine imposed by the Financial Industry Regulatory Authority stemming as a result of his Ameriprise misconduct.
As part of the alleged scheme to defraud, Mata induced his victims to invest their money in Secured Capital, a real estate investment program that purportedly invested in “government-backed tax liens,” “asset-backed deed certificates,” and distressed commercial and residential properties. Mata guaranteed investors that Secured Capital’s investment return generated annual rates of 5 percent to 10 percent, when in fact, investments in Secured Capital had significant loss risks and did not make a profit from 2011 onward, the indictment alleges.
Instead of properly investing his clients’ money, Mata allegedly used Secured Capital investor funds to pay his personal expenses, including a $197,000 down payment on his personal residence, loans to himself and to other entities he created, and $370,000 that was transferred into his personal bank accounts.
Mata also is charged with making false statements on bankruptcy court documents, and fraudulently concealing from the government and his creditors personal property, including a 2008 Mini Cooper and a 2001 Jeep.
An indictment contains allegations that a defendant has committed a crime. Every defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.
In 2015, the United States Security and Exchange Commission filed a civil action against Mata and two business associates, alleging that they operated the real estate scam. Later that year, the SEC obtained a judgment against Mata that enjoined him from violating securities laws and ordered him to pay $11,748,831.
This matter was investigated by the Federal Bureau of Investigation.
This case is being prosecuted by Assistant United States Attorney Sean D. Peterson of the Riverside Branch Office. Assistant United States Attorney Jonathan Galatzan is handling the asset forfeiture portion of the case.