Robert V. Matthews, 61, of Palm Beach, Florida, pleaded guilty today in Bridgeport federal court to conspiracy, money laundering, and tax evasion in connection with a sprawling fraud scheme that preyed on foreign investors seeking U.S. green cards through the EB-5 visa program. The real estate developer admitted to orchestrating a web of lies involving fake ownership, phantom celebrity endorsements, and the theft of investor funds meant for a luxury hotel project in Palm Beach.
Matthews, the mastermind behind The Palm House Hotel (PHH) development, duped investors by falsely claiming that their EB-5 funds would finance the redevelopment of the property. He falsely asserted that high-profile entertainers, business leaders, and politicians would be involved with the project and that his brother, Gerry Matthews, was the true owner and operator of Palm House, LLC. In reality, Robert Matthews maintained complete control of the company, even though his brother was listed as the 99 percent owner in official documents.
The EB-5 program allows foreign nationals to obtain permanent residency by investing in qualifying U.S. development projects. South Atlantic Regional Center, LLC (SARC), an approved intermediary in Palm Beach, marketed the PHH project to international investors between 2012 and 2014. Investors wired millions into SARC-controlled accounts, believing their money would be used solely for PHH. Instead, Robert Matthews and his associates siphoned the funds for personal use, including paying off credit card debts and buying luxury properties in Washington Depot, Connecticut.
Among the stolen funds, Matthews used investor money to repurchase a Connecticut property he had previously lost in foreclosure. He conspired with construction contractor Nicholas Laudano to conceal their relationship and the illicit source of the purchase funds. Laudano, who had long worked on Matthews’ construction projects, played a key role in laundering the money through a series of shell transactions across Florida and Connecticut bank accounts.
Robert Matthews’ wife, Maria Matthews, 52, also pleaded guilty today to federal tax evasion. The couple maintained homes in both Florida and Connecticut while hiding the true nature and origin of their income. They failed to report hundreds of thousands of dollars in gains and benefits derived from the fraud scheme, including property acquisitions and debt relief funded by EB-5 investor money.
“This was not development—it was deception,” said John H. Durham, U.S. Attorney for the District of Connecticut. “Matthews sold dreams to foreign investors while lining his own pockets.” The FBI and IRS-Criminal Investigation, which led the probe, emphasized that no legitimate development ever took place at the PHH site. Sentencing is scheduled for a later date. Robert Matthews faces decades in prison.
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Key Facts
- State: Connecticut
- Agency: DOJ USAO
- Category: Fraud & Financial Crimes
- Source: Official Source ↗
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