A California advisor who once enticed investors to build wealth “God’s way” was sentenced to 14 years in prison by a federal court judge in Los Angeles yesterday for luring investors into fraudulent real estate investments that lost $12 million for his clients.
Paul Ricky Mata, 58, of Oceanside, pled guilty in July to 17 felonies, including 11 counts of mail fraud and three counts of wire fraud, as well as single counts of false statements and concealing assets in bankruptcy. Mata was also ordered to pay more than $12.5 million in restitution to clients by U.S. District Court Judge R. Gary Klausner.
Mata invited investors to put money in several businesses he controlled from August 2008 to September 2015. according to the U.S. Attorney’s Office for the Central District of California. He was the founder of businesses such as Logos Wealth Advisors, Logos Lifetime Enterprises, Logos Real Estate Holdings and Secured Capital.
In his fraudulent solicitation of some $14.5 million from investors, Mata told them, among other things, that money in Secured Capital would yield a guaranteed 5% to 10% return, when in fact, said prosecutors, there was a real risk of loss.
Secured Capital, he told clients, was a real estate investment program placing money in government-backed tax liens, asset-backed deed certificates and distressed real estate, including residential and commercial spaces. But aside from some actual real estate investments, Mata put that money to work paying expenses for other entities he controlled. He also told investors that third parties were appraising his holdings, when in fact it was his portfolio manager. And he sent clients correspondence saying their investments were doing well when in fact they had not turned a profit after 2011.
“Instead of properly investing his clients’ money,” said the Department of Justice, “Mata used Secured Capital investor funds to pay his personal expenses, including a $197,000 down payment on his personal residence in [Upland, Calif.], loans to himself and to other entities he created, and $370,000 that was transferred into his personal bank accounts.”
Mata had advertised himself as a financial expert and serial entrepreneur through radio broadcasts, as the author of the book Create Indestructible Wealth, and as the creator of the Logos Lifetime University. He also put out YouTube videos advertising his seminars and bootcamps on wealth creation. Two of his videos were called “Finances God’s Way” and “Indestructible Wealth,” according to the U.S. Securities and Exchange Commission,
The SEC announced civil fraud charges against Mata and two others in 2015 for diverting proceeds from 100 investors from whom they had raised the $14 million for purported real estate assets. Prosecutors said that he met many of these clients through church.
“It was not simply that [Mata] was an investment advisor to his victims,” said the prosecutors in a sentencing memorandum. “He prayed with them, professed to share values and beliefs with them, and he acted like they were his friends. Moreover, many of his victims are currently retired, and/or were in the process of retiring when [Mata] advised them to enter into his risky investments based on false pretenses.”
He solicited some of his clients through his former firm, Ameriprise, which terminated him in 2009 for a number of policy violations, including his recommendations to clients that they purchase outside securities and take out inappropriate loans to finance investments, according to the indictment.