NEWARK, NJ – An Indianapolis man was sentenced to 41 months in prison for his role in a multi-million dollar Ponzi scheme that targeted real estate investors in Indiana and New Jersey, according to a federal indictment.
Herbert Whalen, 50, of Indianapolis, Indiana, pleaded guilty in Newark federal court to conspiracy to commit wire fraud, which is a serious crime that involves using electronic communications to defraud victims.
Whalen, who operated Oceanpointe Property Management in Indianapolis, engaged in a scheme to obtain money from real estate investors by misrepresenting and concealing the poor condition of properties managed by Oceanpointe, the indictment said.
According to documents filed in this case and statements made in court, from August 2016 to July 2018, Whalen created fake leases for unoccupied Oceanpointe properties, making it appear to investors that Oceanpointe properties were rented, when, in fact, the properties remained vacant.
Whalen and others commingled tenant rent payments and selected which investors would be paid from the pool of funds in order to silence investors who voiced concerns and evade detection of the fraud, the indictment stated.
Whalen’s scheme led to millions of dollars in losses to investors, which he used to fund his lifestyle, officials said.
Judge Madeline Cox Arleo sentenced Whalen to 41 months in prison and three years of supervised release, according to court documents.
The FBI’s Newark office conducted the investigation, which led to the charge against Whalen.
Whalen’s defense counsel, John L. Tompkins, did not respond to requests for comment.
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Key Facts
- State: New Jersey
- Category: White Collar Crime
- Source: DOJ Press Release â†â€â€
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