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$17 Million Securities Heist Lands Investor 10 Years Behind Bars
A former real estate mogul has been sentenced to 10 years in prison for orchestrating a $17 million securities fraud scheme that left hundreds of elderly investors in financial ruin.
Carlton P. Cabot, the former owner and chief executive officer of Cabot Investment Properties LLC, was sentenced in Manhattan federal court to 10 years in prison for defrauding elderly investors in numerous real estate investments.
According to prosecutors, Cabot misappropriated approximately $17 million of investor funds to pay for personal and business expenses, and concealed the fraud from the investors with manipulated financial statements.
U.S. Attorney Preet Bharara said, ‘Carlton Cabot took $17 million from vulnerable investors and spent it lavishly on himself, and then lied to cover it up.’ He added that the victims, many of whom were in their 70s and 80s, were simply looking for a steady income stream to sustain them in their retirement, but instead faced financial ruin.
Cabot, 54, of Stamford, Connecticut, was also ordered to pay restitution to the victims. The scheme, which lasted from 2003 to 2012, involved 18 so-called tenants-in-common securities offerings to investors across the United States.
Prosecutors alleged that Cabot repeatedly transferred money out of bank accounts belonging to the investments and into his own accounts, using the funds to pay for unauthorized purposes, including personal expenses and business expenses.
Cabot’s co-defendant, Timothy J. Kroll, CIP’s chief operating officer, also provided false and misleading financial reports to the investors, concealing the fact that CIP owed large sums of money to the investments.
By the end of 2012, CIP and its principals owed approximately $17 million to the investments, which has never been repaid.
Cabot’s sentencing brings an end to a long and complex case, but it is unlikely to bring closure to the victims who were left financially devastated by the scheme.
Key Facts
- State: New York
- Category: White Collar Crime|Fraud & Financial Crimes
- Source: DOJ Press Release â†â€â€
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