The owner of a Los Angeles area real estate firm pleaded guilty to running a home flipping scheme that scammed 25 victims out of $2 million.
In April 2018, Daniel B. Vazquez Sr., 56, of Ladera Ranch just outside of L.A., was charged with 10 counts of mail and wire fraud related to collecting money from investors and then using it for purposes other than acquiring real estate.
As first reported by local press, Vazquez operated a real estate company, Hoplon Financial Group and New Economic Opportunities Fund I LLC, that promised investors bi-annual returns on real estate properties bought, renovated and then re-sold with their money.
According to the FBI, Vazquez sold these investments between 2010 and 2014 and then used the money on personal expenses. $1 million of the collected funds went toward renovating his home, buying luxury cards and paying off credit cards. He had a total of 25 victims, many of whom were elderly and entrusted Vazquez with retirement savings in the hope of seeing returns.
This type of Ponzi scheme routinely comes up in real estate — in April, a California developer and two of his associates were also arrested on charges related to promising investors low risk and high returns from real estate and then putting their money toward themselves.
Assistant U.S. Attorney Greg Staples said that Vazquez entered a plea without an agreement with prosecutors. He is scheduled for sentencing on July 8 and faces up to 200 years in federal prison.