A 52-year-old Woodstock man was sentenced to 11 years in prison Monday after admitting that he bilked investors out of more than $7 million while running a Ponzi scheme.
Francis X. Sanchez admitted that he fraudulently obtained more than $7 million from investors in his company, InvestForClosures, which purported to buy distressed houses, rehabilitate them and sell them for a profit.
Sanchez pleaded guilty in May, less than three months after his business partner and co-defendant, James D. Bourassa, 55, of Gilberts, pleaded guilty to mail fraud. Bourassa was sentenced to 51 months in prison.
Sanchez admitted to telling investors their investments would be safe because they were backed by real estate and that the majority of their investments were used to purchase real estate, but the investments were instead used to pay Sanchez’s and Bourassa’s salaries and to make Ponzi-type payments to early investors.
To prevent investors from demanding their money back, the men told investors they were developing an exclusive, luxury, residential community in Mexico known as the “Sands of Gold,” according to prosecutors.
During the course of the scheme, Sanchez obtained more than $9 million from investors, and approximately $1.7 million was paid back through Ponzi-type payments, according to prosecutors.
As part of the plea deal, Sanchez was also ordered to pay more than $7.8 million in restitution to the victims.Copyright © 2013 Paddock Publications, Inc. All rights reserved.