Former Walnut Creek real estate investor Benny Chetcuti, Jr. was sentenced Wednesday to 51 months in prison by a U.S. District Court Judge who also ordered him to pay $21,823,526.10 in restitution as well as forfeit $3,968,995 in proceeds obtained from a multi-year real estate investment fraud scheme.
In a release issued by United States Attorney Melinda Haag, federal prosecutors said Chetcuti, 60, admitted to defrauding investors who loaned him money in the belief that those loans were backed by equity in real property. In fact, between 2007 and 2010, Chetcuti intentionally misrepresented details of the loans, including how much equity was available to secure them, the amounts and seniority of loans already tied to the properties, and how the loans were used.
Chetcuti also misled investors about whether their loans were recorded through deeds of trust, according to prosecutors. He pleaded guilty to two counts of wire fraud stemming from his indictment by a federal grand jury on March 27, 2014.
Chetcuti operated the real estate investment firm Chetcuti & Associates in Walnut Creek since 1998, Chetcuti orchestrating the purchase and quick re-sale of homes after renovation. The business was funded in large part by loans from private individuals, according to federal prosecutors, with Chetcuti allegedly forging deed recordings, letters from letters and title company officers while directing others to impersonate escrow officers.
Wednesday’s sentence was handed down by the U.S. District Court Judge Jeffrey S. White, who also sentenced the former investor to a three-year period of supervised release and explicitly barred him from participating in any real estate, banking, or lending-related activities.
Chetcuti was ordered to self-surrender to federal authorities on June 4, 2015 for commencement of sentence.