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Justice News

Department of Justice
U.S. Attorney’s Office
Northern District of Texas

FOR IMMEDIATE RELEASE
Friday, March 4, 2016

Rockwall, Texas, Man Sentenced to 80 Months in Federal Prison on Investment Fraud Conviction

DALLAS — Mark Lee Cleaton, 34, of Rockwall, Texas, was sentenced yesterday afternoon by U.S. District Judge Jane J. Boyle to 80 months in federal prison and ordered to pay $343,353.00 in restitution, following his conviction at trial in October 2015 on four counts of wire fraud stemming from an investment fraud scheme he ran, announced U.S. Attorney John Parker of the Northern District of Texas.

Judge Boyle ordered that he surrender to the Bureau of Prisons on April 6, 2016.

Cleaton was the managing member of North American Capital, LLC, formerly located at 2001 Bryan Street, Suite 2125, in Dallas.  He created a limited partnership, North American Capital Investment Fund, LP (NACIF), in August 2009.  From approximately August 2009 to July 2010, Cleaton solicited $350,000 in investments in NACIF from several individuals, promising to invest that money in short-term, high-yield real estate projects, when, in reality, he misappropriated all the money for himself, spending none of it as promised.

Throughout the scheme, Cleaton provided false investment memoranda and marketing materials to potential investors concerning the investment opportunity.  Some of that material falsely represented an audited “7 year performance” history of NACIF, when as Cleaton well knew, NACIF had not even existed for seven years or had any rate of return.   

Cleaton instructed each investor to wire funds into a checking account over which he had sole signatory authority.  By the time he received the first investor’s funds, he had been locked out of his office in Bryan Tower for non-payment of two months’ rent.  Cleaton immediately spent the investors’ money within weeks on personal expenses and unrelated business ventures, including credit card bills, trips to Hawaii, cash withdrawals, a used car business, and a high-end car audio/stereo store.  He also intentionally failed to disclose to subsequent investors that he had already raised and spent prior investors’ money.  Additionally, he made lulling payments to one victim investor from a later investor’s funds.

The FBI investigated the case.  Assistant U.S. Attorney Nick Bunch and Deputy Criminal Chief Assistant U.S. Attorney Katherine Miller prosecuted.

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Topic: 
Financial Fraud
Updated March 4, 2016