Ponzi Scheme Leader Pleads Guilty To Felonies, Losses Equal $20k
Monday, January 3, 2011
SAN DIEGO The ringleader of a San Diego Ponzi scheme, in which Filipino homeowners struggling to make mortgage payments were urged to transfer titles to their properties into a bogus trust, pleaded guilty today to five felony counts, including grand theft and perjury.
Edmundo Rubi, 53, will be sentenced to six years in state prison on Feb. 10.
Deputy District Attorney William La Fond told Judge Louis Hanoian that Rubi convinced more than 20 people to "quitclaim" more than 30 properties into his fraudulent trust, telling them that he would maximize their investment through his expertise, which he didn't have.
Total losses came to $20,000, La Fond said.
The defendant convinced one woman to "quitclaim" two properties into trusts called "Apocalypse Trust" and "Amerisian Trust" and had her write him a check for $400, the prosecutor said.
A "quitclaim deed" allows a person to transfer their interest in a property to another person.
When the woman asked that the deal be undone, Rubi filed a lawsuit against her and others, La Fond said.
Rubi also filed court documents stating that he had been to prison for drug convictions, when in fact he had served 70 months in federal prison for swindling $24 million out of 425 mostly Filipino victims in 2005 in another Ponzi scheme, La Fond said.
Besides grand theft and perjury, Rubi pleaded guilty to attempted foreclosure consultant fraud and two counts of using a scheme to defraud with the offer of the sale of a security. Another 49 counts in the indictment were dismissed as a result of his plea.
Before his arrest in July 2009, Rubi met with undercover agents posing as investors and requested they put up between $20,000 and $30,000 for projects such as a high-speed rail between Las Vegas and San Francisco, low-income housing in San Diego and construction of a nursing home in Northern California, guaranteeing a 3 percent return, authorities said.
La Fond said authorities were able to catch the defendant before he was able to victimize more people through his fraudulent scam.
Co-defendant Joseph Mariano Encarnacion pleaded guilty to helping Rubi in the scheme and was sentenced to four years behind bars.
Husband-and-wife real estate agents Ben and Gloria Hebron pleaded guilty to taking part in the scheme and were sentenced to probation and ordered to give up their real estate licenses.