Naples Man Sentenced To More Than Six Years For Operating An $8 Million Investment Scheme
Fort Myers, Florida – United States District Judge Sheri Polster Chappell today sentenced Dorian Garcia (31, Naples) to six years and six months in federal prison for wire fraud. As part of his sentence, Garcia will forfeit pieces of artwork that were purchased with proceeds of the fraud, along with a $10,000 retainer that he had paid to a law firm. The Court also entered a money judgment in the amount of $3,108,734.52, the proceeds of the scheme. Garcia will also be required to pay restitution in the amount of approximately $5 million, representing the approximate loss to victims. A restitution hearing has been scheduled for May 16, 2016.
According to the plea agreement, from February 2009 through April 2015, Garcia induced investors to provide money to him based on misrepresentations that he would invest their funds and guarantee their initial investment, as well as a specific rate of return over a defined term of the investment. As part of the scheme, Garcia presented investors with false bank statements indicating large account balances, when in fact the true amounts were a small fraction of what Garcia claimed to be in the accounts, and were insufficient to support the guarantees he had promised. Garcia facilitated the scheme through a number of companies that he controlled, including DG Wealth Management ("DG Wealth"), Macroquantum Capital LLC ("Macroquantum"), Commodity Projections and Predsyst LLC, and UKUSA Currency Fund LP ("UKUSA"). According to statements made during the sentencing hearing, Garcia solicited and received at least $8 million dollars from approximately 111 victims located throughout the United States. Garcia only repaid approximately $3,990,285.48 to any of the victims.
Garcia only invested a small portion of the funds provided by investors. After investors had provided him with money, Garcia continued to send them false trading statements reflecting that he had earned trading profits, when he had not. Instead, Garcia used a greater portion of investors’ funds to repay other investors by disguising new investments as trading profits. Garcia also used a significant portion of the invested funds for personal and business expenses, including artwork, rent, luxury car payments, domestic help, including a personal chef, jewelry, and dinner parties.
When investors began asking for their money back, Garcia provided a series of misrepresentations as to why he could not do that and often insisted that they sign new agreements falsely appearing to convert their investments into loans. In addition, Garcia encouraged investors to mislead others, including investigators, about the true nature of their investment with him, and encouraged them to falsely claim that they had made a loan to his companies when, in fact, they had provided Garcia money to invest on their behalf.
This case was investigated by the Federal Bureau of Investigation, with assistance from the United States Commodity Futures Trading Commission (Chicago, Illinois), and the State of Florida, Office of Financial Regulation. It is being prosecuted by Assistant United States Attorney David G. Lazarus.
The Commodity Futures Trading Commission (CFTC) offers a free online tool for potential public investors to conduct due diligence on potential financial counselors. CFTC SmartCheck provides easy access to free tools to check the background of financial professionals, and provides information on the latest fraud schemes. For more information, visit www.smartcheck.cftc.gov.