A San Diego man has been indicted for running a multimillion-dollar investment scheme that took in at least $28 million from investors since 2016.
Denny Bhakta, 39, of San Diego, California, was arrested at his residence on Tuesday morning and charged with securities fraud and money laundering, according to court documents and statements made in court.
Bhakta allegedly solicited investments in his companies, Fusion Hotel Management, LLC and Fusion Hospitality Corporation, and told investors that they would acquire discounted blocks of hotel rooms from Hilton, which would then be sold to United Airlines at a higher price for a significant profit.
However, instead of buying the hotel rooms, Bhakta used the money for personal expenses and to make payments to other investors, providing them with fabricated documents to support the false scheme.
The indictment alleges that Bhakta laundered the proceeds of his fraud scheme by using investor funds from Fusion’s bank accounts at various casinos, including the ARIA Resort & Casino and The Cosmopolitan of Las Vegas.
“We will do everything we can to protect investors and to seek justice when they fall victim to scammers,” said Acting U.S. Attorney Randy Grossman.
The maximum penalty for the charges against Bhakta is 20 years in prison.
The next hearing is scheduled for January 21 at 1:30 p.m.
Defendant:
Denny Bhakta, 39, San Diego, CA
Case Number: 21-CR-3352-JLS
Charges:
Securities Fraud – Title 15, U.S.C., Sections 78j(b), 78ff, and Title 17, C.F.R., Section 240.10b-5
Money Laundering – Title 18, U.S.C., Section 1957
Maximum penalty: 20 years in prison
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Key Facts
- State: California
- Category: Fraud & Financial Crimes
- Source: DOJ Press Release â†â€â€
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