A Granite Bay, Calif., financial advisor has been indicted on 50 counts of mail fraud and wire fraud for allegedly enticing more than 100 people to invest in mutual funds that were actually Ponzi schemes and also to invest in fraudulent mortgages. These ventures cost investors a total of more than $17 million, according to the U.S. attorney for the Eastern District of California, Benjamin B. Wagner.
Lawrence Leland, 54, also known as Lee Loomis, of Granite Bay near Sacramento was indicted along with six others in the two schemes. Loomis and his father-in-law, John Hagener, 76, also of Granite Bay, sold investments in Naras Funds, which allegedly offered 12% interest, according to the FBI office in Sacramento. The money was actually used to fund other businesses Loomis ran, to pay himself and his partners, and to pay off earlier investors.
In his mortgage business, Loomis would approach builders of new homes and developers of condominiums to purchase investment homes in bulk at substantial price discounts. He then arranged mortgage loans through his mortgage company, Nationwide Lending Group, to sell mortgages to other investors at full price, according to the FBI. He worked with an appraiser, who has also been indicted, to inflate the value of properties, which Loomis is accused of selling and reselling within days of the first purchases.
Loomis's businesses operated under various names, including Advantage Financial Plan of California LLC and Loomis Wealth Solutions, operating in California and other states.
--Karen DeMasters