Granite Bay Property Investor Sentenced to over 2 Years in Prison for Investment Fraud Scheme
SACRAMENTO, Calif. — John Stuart Hill, 33, of Granite Bay, was sentenced today by U.S. District Judge Morrison C. England Jr. to two years and three months in prison and ordered to pay $1.4 million in restitution to eight victims for wire fraud and mail fraud in connection with a real estate investment scheme, U.S. Attorney Phillip A. Talbert announced.
According to court documents, between August 9, 2011, and April 2013, Hill, acting under the business name Granite Bay Investment Partners (GBIP), solicited and received money from investors who intended that their money would be used to purchase, rehabilitate, and resell residential properties in the Sacramento area. In reality, Hill used the money for his own personal expenses, made false accounting entries on statements he sent to his investors, and misrepresented the purchase and resale prices of the properties in question. In some cases, the properties that Hill alleged his investors to be rehabilitating had never been purchased by Hill or GBIP. In other cases, multiple investors were told that they were partners on the same property in order to increase the amount invested to far above the purchase and rehabilitation costs.
According to court documents, Hill received at least $1.9 million from investors, only $600,000 of which was ever returned, leaving at least $1.3 million unaccounted for. On September 29, 2016, Hill pleaded guilty to wire fraud and mail fraud.
This case was the product of an investigation by the United States Secret Service. Assistant United States Attorney Matthew G. Morris prosecuted the case.